Bank Century Bailout Scandal

[John Kenyon]

Indonesia Matters: “Bank Century Bailout Scandal” plus 1 more


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Bank Century Bailout Scandal

Posted: 07 Dec 2009 07:17 PM PST

Centurygate scandal, Boediono & Mulyani under pressure, SBY sees dire threats to his good self.


The long troubled PT Bank Century (now PT Bank Mutiara), once the country's 13th largest bank, in late October 2008 defaulted on several large loan payments and was declared insolvent by the Financial Sector Stability Committee (Komite Stabilitas Sektor Keuangan (KSSK)), which was led by Finance Minister Sri Mulyani and included then BI Governor now vice president Boediono. It had been under supervision by Bank Indonesia (BI) since 2005.

Boediono's declaration at the time that the bank's financial weakness now

posed a systemic threat to the banking system

was the key factor in Bank Century thereafter being taken over by the Deposit Insurance Agency (LPS) and a series of massive injections of state funds into it proceeding, totalling 6.7 trillion rupiah or almost $700 million, over a period of nine months. Minister Sri Mulyani concurred with the BI Governor's judgement.

As the parliament became aware of the scale of the bailout in mid 2009 its Commission XI for financial affairs held hearings with Mulyani and BI senior deputy governor Darmin Nasution, and soon ordered the Supreme Audit Agency (Badan Pemeriksa Keuangan (BPK)) to launch an investigation.

The scandal that has become known as "Centurygate" revolves around not only the massive drain on state funds involved, but questions of whether some depositors (such as tycoon Boedi Sampoerna) had preferential treatment or access to their funds after the bailout money had been injected, and whether some of the money was diverted and embezzled.

Presently a parliamentary enquiry named "Panitia Khusus Centurygate" (Pansus Centurygate) is underway, and much politically inspired rhetoric has emanated from it, with some calling for the dismissal of Mulyani and vice-president Boediono over their involvement in the case, and even their impeachment.

Meanwhile President Susilo Bambang Yudhoyono (SBY), who retrospectively approves of the bailout as a sound financial decision, has been accused of being weak in handling the fallout from the affair and is becoming increasingly 'testy' and bad-tempered about the matter. A planned mass demonstration on 9th December to mark International Anti-Corruption Day has had the president vocally worrying that there are those who wish to topple him, and warning against any repeat of the May 1998 riots in Jakarta.

Bank Century Bailout Scandal is brought to you by Indonesia Matters, which also features listings of Indonesia hotels, special discounts on Bali hotels, Kuta hotels, Sanur hotels, hotels in Jakarta, and more.

Tags: Badan Pemeriksa Keuangan (BPK), Bank Indonesia, Banking, Boediono, Corruption, Darmin Nasution, Scandals, Sri Mulyani Indrawati, Susilo Bambang Yudhoyono (SBY)



Jakarta Taxis

Posted: 07 Dec 2009 07:17 PM PST

Travelling about Jakarta by taxi, Bluebird, Express, Trans Taxi, the good, the bad, and the ugly.


TAKSI!
Despite my known preference for public transport, I have recently had to use taxis a lot, due to the presence in our domestic midst of one of my offspring, who is brave and resourceful but not yet fully au fait with the intricacies of suddenly having to bail out when a small angkot is inundated with five evil copet2.

Bluebird

Formerly it was a 'given'; that one waited for a Bluebird, but that era has surely passed, for reasons both positive and negative, the latter being that so many Bluebird imitators are now on the roads, with azure livery deceptively designed to fool would-be passengers into believing they are boarding the famously reliable breed, the former reason being that in fact several rival firms are proving equally reliable in terms of both courtesy and service.

I have to say what confirmed my willingness to disavow my erstwhile fealty to the blue vehicles is their appalling level of telephone ordering standards. Almost every time we ring them up and get a promise of a cab for the airport, we then get a call back about 15 minutes prior to the agreed time, saying there are no vehicles available. This subsequently transpires to be omong kosong, for once we have dragged our baggage to the high road, we see scores of Bluebirds sailing emptily past. A driver told us that HQ does not provide drivers with adequate communication!

Express & Trans

So in the course of my peregrinations around our delightful metropolis, I have experimented with alternatives and found two in particular to be excellent, those being -

Express taxis, who have never yet given me cause for complaint, always been most civil, and usually appear to know the difference between north, south, east and west, and
Those Trans Taxis, the wee bright yellow ones that have TV sets installed by the driver, so important cinetrons can be monitored as we zoom along. Their drivers too are good.
Random usage of lesser known varieties has proven a patchy experience, some just fine but others leaving me exasperated when I have to give drivers directions to - for example - Blok M, which one would have imagined is quite a well-known area.

Kosti Jaya, Dian, Prestasi, et al

I have to say that many of the others are not to be recommended. I have rarely if ever found Dian taxi drivers to be either knowledgable, which is useful, or, more useful, being willing to find the right change. Kosti Jaya were once quite good, but seem to be dying out and those who have used the remaining specimens do not have high praise to heap on them.

Those which declare themselves to be 'safe and steady' have not always turned out to be. The old reviled Prestasi breed has disappeared, presumably flying another flag these days.

But I have perforce grabbed obscure varieties, and these can actually be okay. It has for so long been my habit to avoid the others that in all fairness I shouldn't slag them off, for who knows, they may have improved!?! Perhaps other IM acolytes can comment!

Bali Airport Taxis

As a penultimate point, I am just back from a short break in Bali, which reminded me that the Isle of the Gods has less than divine aspects. Coming out of the airport, one is faced with an array of avarice, demanding Rp.80,000 or more to make the immense odyssey to Kuta.

If you are not accompanied by an Indonesian, I hear the rate quoted can be even higher. Press through the throng and the price falls to Rp.70K, then 60K, but once you break through the insanity barrier, which roughly corresponds to the airport carpark, you can negotiate it down to 50 or even less. This particular trip, I was with one of my young uns, and had been prevailed on to stay someplace rather posher than I usually choose. Having got a deal for 55K to Kuta, I gave the name of the opulent edifice and the swine tried to jack it back up to 60! On yer bike, mate!

Jakarta Angkot

But when all is said and done, you can't beat Jakarta's angkots. Last week I boarded a B03 one evening and sat beside the driver, who asked me where I was headed. When I told him the toll gate, he at once negotiated a personal contract to take me there by the shortest route, non-stopping for anyone else, for a mere Rp.5000! God bless enterprise!

Jakarta Taxis is brought to you by Indonesia Matters, which also features listings of Indonesia hotels, special discounts on Bali hotels, Kuta hotels, Sanur hotels, hotels in Jakarta, and more.

Tags: Angkot, Bali, Blok M, Jakarta, Kuta, Ngurah Rai Airport, Taxis, Transport, Transportation