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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Thomas Haegin who wrote (1738)	1/30/1998 4:23:00 AM
From: tom	Read Replies (1) \| Respond to of 9980

In Indonesia the local price of oil/petrol is subsidised but the IMF is forcing them to remove these subsidies (apart from stuff like Kerosene which is used by poor people). At the moment a litre of petrol is US$0.02/litre and so it probably should go up (also 20 Marlboro lights cost US$0.10). The population of Indo probably are going to be a bit annoyed when the price of fuel foes up 4-fold. Indo does make a fair bit of money selling oil + gas (it makes US$4bn/year just from selling natural gas) and it probably should step this up a bit to bring in the US$ (or borrow money securitized on the revenues from it.

To: Thomas Haegin who wrote (1738)	1/30/1998 9:42:00 AM
From: Mohan Marette	Read Replies (1) \| Respond to of 9980

Thomas: Indonesia is also a member of OPEC. I wonder,what happend to all that money? I suspect you guys in Switzerland are holding it for'em, you think?? For safe keeping of course.<VBG>

To: Thomas Haegin who wrote (1738)	1/30/1998 10:28:00 AM
From: Thomas Haegin	Respond to of 9980

Repost: S.Korea to close 10 ailing merchant banks Reuters Story - January 30, 1998 00:30 By Bill Tarrant SEOUL, Jan 30 (Reuters) - A day after agreeing on a critical debt restructuring deal with global bankers, South Korea on Friday ordered the liquidation of 10 failed merchant banks, signalling its intention to reform its financial system. A state institution would take over the assets and debts of the failed merchant banks and would be in charge of managing and selling their assets, a Finance Ministry statement said. The 10 were among 14 merchant banks whose operations were suspended in December because of serious financial problems. The other four remain under suspension until the end of February, pending a review of their "self-rescue" plans, a ministry official said. The 10 merchant banks are: - Gyongnam Merchant Bank , - Coryo Merchant Bank , - Samsam Merchant Bank , - Ssangyong Merchant Bank , - Hangdo Merchant , - Cheongsol Merchant Banking Corp , - Shinsegae Merchant Bank , - Shinhan Investment Bank , - Hanwha Merchant Bank - and unlisted Kyungil Merchant. A Finance Ministry official said the merchant banks would have 10 days to appeal before they are liquidated. The Finance Ministry had already set aside three trillion won ($1.9 billion) from public bond sales to finance deposit withdrawals at the 14 merchant banks. The ministry said last year the government would ensure the safety of private financial deposits and interest until the end of 2000 under deposit insurance programmes. Thousands of depositors swarmed to the 14 firms earlier this month to get their money out, which complicated efforts by the merchant banks to escape financial ruin. The plight of South Korean merchant banks began in the early days of Asia's financial crisis as their emerging market portfolios turned sour and foreign credit lines dried up. They were heavily involved in corporate financing. And the bankruptcy of major conglomerates put them in bigger trouble, sending them scrambling to find local cash at exorbitant interest rates. Their problems were a major contributing cause to South Korea's financial crisis, which forced Seoul to agree a record bail-out of nearly $60 billion arranged by the International Monetary Fund. South Korea's 30 merchant banks had become a rising star in global finance with their aggressive investment drives in Indonesia, Russia, Brazil and other emerging markets. Some 24 of them sprang up in the past two years alone as they generated easy profits by raising cheap funds abroad and investing them in high-return but high-risk markets. The failures of financial institutions, something almost unthinkable in South Korea until recently, has now become a painful reality. The government plans to sell two major commercial banks, Seoulbank and Korea First Bank , next month. Two major securities houses went bankrupt in December. The decision to close the merchant banks followed a bank financing accord struck in New York this week, which allows South Korean banks to exchange an estimated $24 billion in short-term, non-trade credits for loans maturing in one to three years. Pricing was the key to the deal and turned out to be much better than many had expected in Seoul. The loans, guaranteed by the Republic of Korea, bear floating rates of 2.25 percent, 2.50 percent and 2.75 percent over the six-month London Inter-Bank Offered Rate (LIBOR), which now stands at around 5.75 percent. Analysts had expected Seoul would be forced to pay around 400 basis points over LIBOR, reflecting the downgrading of its debt to junk bond status by international credit rating agencies. Global creditors, which have been in talks with Korean officials for weeks on this deal, also conceded another key demand -- a call option allowing Seoul to prepay the loans, once its credit ratings improved. ----------ENd--------------

To: Thomas Haegin who wrote (1738)	1/30/1998 10:30:00 AM
From: Thomas Haegin	Read Replies (1) \| Respond to of 9980

Repost: Aetna says enters Thailand insurance market Reuters Story - January 29, 1998 23:12 %INS %US %TH %EMRG AET V%REUTER P%RTR HARTFORD, Conn., Jan 29 (Reuters) - Aetna International, a unit of Aetna Inc. , said Thursday it agreed to form two insurance joint ventures in Thailand with Osotspa Company Ltd. Financial terms were not disclosed. Aetna said it will own 20 percent of the property-casualty company, Osotspa Insurance Co. Ltd, and 25 percent Osotspa Life Insurance Co. Thailand caps foreign ownership of local firms at 25 percent. Aetna, the biggest health insurer in the U.S., said it saw solid growth potential in Thailand. "This alliance with Osotspa presents an excellent opportunity for Aetna to enter a new market in the Asia Pacific region at a time valuations are modest," Aetna International President Frederick Copeland, Jr., said. He said that only a small fraction of Thailand's 60 million people owned insurance. "With the government's ongoing plan to liberalize the insurance industry, we believe the demand for insurance products will increase expotentially in the years ahead as the economy stabilizes and begins to grow again," Copeland said. Aetna has Asian operations in China, Hong Kong, Indonesia, Malaysia, New Zealand, the Philippines and Taiwan. Aetna shares dipped $0.25 to close at $75.1875 on the New York Stock Exchange on Thursday. Osotspa Company Ltd, founded in 1891, is a Thai conglomerate with holdings in manufacturing and distribution of beverages, pharmaceuticals, and consumer and industrial products. ((--Hartford newsroom, (860) 727-0224)) ------------End--------------------