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Dutch court freezes Indover assets
The Jakarta Post | Tue, 10/07/2008 8:41 PM | Business
A Netherlands court has frozen the assets of Indonesische Overzeese Bank NV (Indover), on the back of a growing financial crisis in Europe and the bank's dwindling performance.
All individual assets stored in the bank (which amounted to some US$15 million) will be guaranteed by the government, the court decreed on Tuesday.
The court's ruling on Indover, which is partly owned by the Bank of Indonesia (BI), was made at the request of the Netherlands' central bank.
BI (Indonesia's central bank) has invested Rp 53.9 billion into the company, which in the last couple of years has been registering losses. Indover has subsidiaries in Singapore and Hong Kong.
BI is currently in the middle of divesting all of its shares in Indover, as set out in the Central Bank Law which forbids BI from owning a profit-seeking subsidiary.
Earlier reports suggested Indonesia's biggest bank by assets, Bank Mandiri, was proposing to acquire BI's shares in Indover. (and)
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Pieter van Veld (not verified) — Mon, 10/13/2008 - 5:40pm
Do I get it right: The Central Bank of Indonesia allows its subsidiary to go bust?? Can't believe.
Michael Hofman (not verified) — Fri, 10/10/2008 - 3:55pm
If I am not mistaken, BI has given a written letter of comfort, guaranteing the existance of Bank Indover as long as BI is their shareholder.
The refusal of BI to comply to its promise will be noticed in the financial world as a very negative sign with severe impact on the reliability of Indonesian Authorities.
If one can not even trust the word of a Central Bank, whome else to trust in these difficult time?