Probe launched into Bank Bali

By Lachlan Colquhoun
Updated: 18:00 EST, 6 September 1999

 

The scandal over Standard Chartered's takeover target Bank Bali has taken a new turn, with Indonesia's parliament forming a special investigation into the affair.

The Bank Bali matter involves the controversial transfer of around US$80 million (£50 million) to a company closely linked to supporters of President Habibie, ostensibly as commissions for helping recoup interbank loans.

The issue has severely dented confidence in Indonesia's bank restructuring agency. IMF Asia-Pacific director Hubert Neiss was recently reported as saying the next US$450 million tranche of credit to Indonesia was contingent on the resolution of the Bank Bali case.

Standard Chartered is due to pay US$56 million and take control of the bank.