Two firms fined for role in Bank Mashill's share deals
JAKARTA (JP): The Capital Market Supervisory Agency (Bapepam) announced yesterday that Bank Mashill Utama had been fined Rp 7 million (US$3,000) and PT Sumatra Central Prima Rp 500 million in connection with improper transactions of the bank's shares made last month.
Rumors concerning a hostile takeover plan on Bank Mashill, which emerged following a series of big transactions on the bank's shares through the Jakarta Stock Exchange (JSX) in early April, had caused a controversy and heated debates among market players, economists, market regulators and even the House of Representatives.
The agency said in a six-page statement which detailed the findings of its investigations into the transactions of Bank Mashill's shares that it was true that several big deals had been made on Bank Mashill's shares through the JSX, causing a significant change in shareholders composition, but the Kerta Widjaja family still owns 51 percent of the bank.
The statement said that a Bank Mashill director, Leo Yasin, and one of the bank's major shareholders, PT Sumatra Central Prima, sold 130,000 shares and 26 million shares respectively through the JSX on April 8 and 9.
On April 9, two foreign companies -- Castlemere Enterprises Ltd. and Duncanmill Holdings Inc. -- bought 33.6 million Bank Mashill shares.
"As of April 15, Duncanmill already owned 19 million shares or 17.78 percent of Bank Mashill, while Castlemere owned 16.55 percent or 18 million shares," the statement said.
A director of PT Citra Marga, Tito Sulistio, disclosed that Duncanmill is a finance company based in the British Virgin Islands, jointly owned by President Soeharto's second daughter Titik Prabowo, Tito Sulistio, PT Steady Safe's president Jopie Widjaja and PT Bhakti Investama's president Harry Tanusudibyo.
Tito added that Castlemere is a Singapore-based trading company owned by businessman Amir Gunawan.
The two parties, according to the Bapepam statement, reported to Bapepam on April 17, April 18 and May 1 that they had executed the transactions but did not reveal their intention to sell or buy more shares.
Tito, on behalf of Duncanmill and Amir of Castlemere, however, told newsmen on April 10 that they intended to propose a change in the bank's management and that Castlemere would make a tender offer to buy Duncanmill's stake.
The take-over rumors caused Bank Mashill's share price to rise 94 percent from Rp 1,375 on April 1, to Rp 2,700 on April 9. On April 9 alone, the price sharply increased from Rp 1,950 to Rp 2,700.
The agency, however, said that it didn't find any evidence that Tito's statement had provided misleading information to the investing public.
"We have conducted a special investigation on Tito, because when the transaction was made, he had become a commissioner of the Surabaya Stock Exchange and a commissioner of the Indonesian Clearing Depository (PT KDEI)," the agency said.
"We therefore warned him to be more careful in the future."
Tito, when contacted by The Jakarta Post yesterday, refused to give any comments.
The agency also found out that none of Mashill's executives had given an official statement to the public about some big transactions on Mashill's shares between April 1 and April 9, although one of the bank's directors who is also a commissioner of PT Sumatra Central Prima -- Jensen Koharjo -- had been informed about the transactions.
Based on those findings, Bapepam decided to fine Bank Mashill Rp 7 million for waiting seven days before reporting the transactions made by Jensen or Sumatra Central Prima to the agency.
The agency also fined Sumatra Central Prima Rp 500 million for engaging in insider trading, which was executed by PT Surya Dumai Sekurindo.
Noted economist Sjahrir hailed Bapepam's action, yet he wondered why Tito received a light punishment.
Sjahrir told The Jakarta Post last night that Bapepam's statement was ambiguous.
"It's cute. The statement said that Tito's action was considered controversial, but the penalty was only in the form of a warning. I think he must be ordered to step down from his current position as SSX's commissioner." Sjahrir noted.
He said that Bapepam should further investigate to ascertain as to whether Castlemere and Duncanmill are operating legally.
"Bapepam should also examine the source of the funds used by those parties to pay for the transactions, because it was a big deal. How could they have made a transaction up to Rp 61 billion in only one day?" Sjahrir questioned. (alo)