After more than 10 years of dispute over the recovery of central bank bailout funds, several recalcitrant debtors have agreed to cooperate.

As a result of progress after enquiries last year by the House of Representatives into the settlement of squandered Bank Indonesia liquidity support (BLBI) funds worth Rp 702 trillion (US$ 62.1 billion) of taxpayers money, the Finance Ministry disclosed Wednesday that eight debtors have agreed to relinquish more assets to settle the dispute.

After a hearing with the House's BLBI supervisory team, Finance Minister Sri Mulyani Indrawati said eight debtors supervized by the ministry have signed a deal to settle their debts once and for all.

"They have inked the debt settlement deal. We are now valuing their assets. If the value is still lacking, they have to top up to cover the shortfall," she said.

According to the Supreme Audit Agency (BPK), the eight debtors under the ministry's settlement deal, owe the state a total of Rp 2.3 trillion.

However, the figure can reach higher than that, if the BPK include interests and fees which should be paid by the debtors, say lawmakers.

Bank Indonesia provided the liquidity support funds BLBI to help ailing banks during the Asian monetary crisis in 1997 and 1998.

Only a small part of Rp 702 trillion lost was recovered after the crisis.

Dradjad H. Wibowo, a member of the BLBI's supervisory team, said debtors had agreed to settle debts with assets, which would then be sold by the government.

"We expect the money (from the asset sale) could be included in the 2009 state budget. The assets should be sold this year considering the case started 10 years ago," he said.

An investigatory motion by the lawmakers was launched early last year with the aim of pushing the government to set legal and political parameters for the conglomerates accused of stealing BLBI funds and concerning the amount of money that could be returned to the state.

Deputy House budgeting committee chairman Hari Azhar said the queries showed political commitment by lawmakers to end the case.

Chairman of the BLBI's super-visory team Aulia Rahman said lawmakers would hold a meeting with the ministry on Feb. 4 to oversee the progress in recovering the BLBI funds, with the Attorney General's Office and National Police on Feb. 11 and Feb. 18, to seek progress in the parallel prosecution of these cases.

The Attorney General's Office (AGO) and the National Police are each handling eight debtors.

Golkar and the Indonesian Democratic Party of Struggle (PDI-P), the two largest House factions, had previously opposed questioning the government as this might disclose alleged fund flows to both parties.

Several figures from the two parties are believed to have been involved in the disbursement of BLBI funds to eight private banks during the economic crisis. The PDI-P was also blamed for halting investigations into certain BLBI debtors under the so-called Master of Settlement Agreement during the administration of President Megawati Soekarnoputri.

Eight BLBI debtors under Finance Ministry supervision

1.James Januardy (Bank Namura)

2.Adisaputra Januardy (Bank Namura)

3.Atang Latief (Bank Bira)

4.Lidya Mochtar (Bank Tamara)

5.Omar Putihrai (Bank Tamara)

6.gMarimutu Sinivasan (Bank Putera Multikarsa)

7.Agus Anwar (Bank Pelita/Istismarat)

8.Ulung Bursa (Bank Lautan Berlian)

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