Troubled banks vow to return credits

Troubled banks vow to return credits

JAKARTA (JP): Owners of eight troubled banks have vowed to
draw on their assets to pay back liquidity credits they received
from Bank Indonesia, Deputy Attorney General Soehandjono said on
Wednesday.

"From the (owners of) nine banks now being questioned (by the
Attorney General's Office), eight banks have vowed to repay the
credits with their assets," Soehandjono told reporters at the
Attorney General's Office in South Jakarta.

Soehandjono, who heads the credit-recovery team, said the
ninth, Bank Surya, was still negotiating the repayment of its
credits with the Attorney General's Office.

Surya is owned by former president Soeharto's cousin
Sudwikatmono. During questioning on Monday at the Attorney
General's Office, he had pledged to repay the liquidity credits
with his assets.

Sudwikatmono said his bank received more than Rp 1 trillion in
liquidity credit from the central bank.

Attorney General Office spokesman Soehandoyo said last week
that in addition to Sudwikatmono, executives from Bank Modern,
Bank Umum Nasional, Hokindo Bank, Deka Bank, Bank Subentra, Bank
Pelita, Centris International Bank and Bank Istismarat were also
being questioned by state prosecutors over their use of the
credit facility.

Attorney General Andi Muhammad Ghalib, who was also present at
the media briefing on Wednesday, did not dismiss the possibility
of prosecuting the bankers.

"If they cannot repay their liquidity credits or their assets
are worth less than their debt, they could be prosecuted.

"But our priority right now is to save the state assets." He
met earlier with National Police Chief Lt. Gen. Roesmanhadi at
his office.

Andromeda

Meanwhile, Roesmanhadi denied the police had summoned
liquidated Bank Andromeda commissioners and directors, including
Soeharto's son Bambang Trihatmodjo, over allegations of a scam at
the bank.

"We haven't issued any summons or arrest warrant against Bank
Andromeda commissioners," Roesmanhadi said.

His statement contradicted that of his subordinate, Maj. Gen.
Da'i Bachtiar, who said last week the police had summoned the 10
Andromeda commissioners and directors to clarify whether the bank
had violated lending limits before the government closed it last
November for mismanagement.

Da'i, who was seated behind Roesmanhadi at the briefing,
remained silent.

Roesmanhadi denied police were reluctant to summon the
commissioners because of the link to Soeharto.

"It is not because of the family of the former president, but
simply because there have not been any summons or arrest warrants
issued (against the commissioners). We just plan to question Bank
Andromeda directors."

Also on Wednesday, timber tycoon Mohammad "Bob" Hasan, owner
of suspended Bank Umum Nasional, was again questioned by the
Attorney General's Office over receipt of liquidity credits.

Hasan reiterated his willingness to relinquish all of his vast
business network to repay the liquidity credits, amounting to Rp
6.63 trillion.

The government recently set a Sept. 21 deadline for the banks
to repay the central bank. The Indonesian Bank Restructuring
Agency (IBRA) has been authorized to seize bank owners' private
assets if they miss the deadline.

Minister of Justice Muladi said last week that the authorities
had tightened security at the Halim Perdanakusuma Airport in East
Jakarta, where some bankers keep private planes, to guard against
attempts to flee abroad.

Ninety-six bankers are under investigation as the government
tries to clean up the hobbled sector. (byg/emf)