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

To: tom who wrote (3613)	5/15/1998 12:23:00 PM
From: MikeM54321	Read Replies (2) \| Respond to of 9980

tom, I found the article I referred to earlier. None of us are wrong about what we read, the Japanese exposure to Indonesia changes on a regular basis depending upon what day it is. As a side note, the top 15 banks in Japan have to come clean next week on exactly how their balance sheets look. I believe this is going to happen over a three day period. Next, Wednesday, Thursday, and Friday. This was a direct result of the "Big Bang" plan put into effect April 1st of this year. Maybe we will hear more about the true Indonesian exposure next week. Should be interesting. If you read the excerpt below in detail, if it wasn't so painful, it would be funny. Can you imagine the Indonesian debt holders sitting across the table from the big Japanese bankers, "negotiating" the terms of repayment? I bet it wasn't much of a negotiation. Japan can't squeeze blood out of a rock. The Indonesians actually wanted to postpone repayment for four years. Then the Japanese spokesman comes out and claims the talks went well. Everything is fine. Next few days, Indonesia, burns. It's sad, but I guess it's easy for us to watch from afar and see how crazy the situation is. But if we personally had our butts on the line for billions of dollars, it would be difficult for us to face reality also. It's sad and scary how badly banks can get into trouble. Bank failures are one of the catalyst for large market, "corrections." I guess we, the United States, went through our crisis so we certainly aren't immune. MikeM(From Florida) >>Sunday May 10, 1998 Indonesia debt talks left key issue unsolved TOKYO- Indonesia and its creditors on Sunday ended another round of talks on how to reschedule the nation's private-sector debt, but with no agreement on the most thorny issue of resolving the debt held by corporations. The bank steering committee said in a statement that it and Indonesia made progress in finding solutions for the problems of Indonesian banks' foreign currency debt and trade finance, but more work needed to be done for corporate debt problems. The committee would respond positively to Jakarta's request for a 30-day rollover in bank debts and that it had agreed to maintain trade financing, the statement said. ''From the banks' side, we're very satisfied progress was made. We're not at all disappointed and we also got the same sense from the Indonesians,'' a western banking source who participated in the negotiations said. ''I hope the markets will respond. It will be a big mistake if they don't,'' the source, who requested anonymity, said. But analysts said the problems of bank debt and trade finance were of minor importance compared with corporate debt. ''The outcome of the meeting was disappointing, as there seems to have been little progress on corporate debt side,'' said Takashi Nobehara, general manager of Centre for Asian Studies at Japan Research Institute, Ltd. Indonesia's private foreign debt totalled $67.69 billion at the end of January, $8.9 billion of which is owed by the banking sector and $58.79 billion owed by non-bank corporations, the country's central bank said in April. The three-day talks in Tokyo followed earlier discussions between Indonesia and its creditors in New York in April, and the next round will be held in Frankfurt from May 26. One of the more contentious issues appeared to be the length of a possible postponement of corporate debt repayments, according to sources close to the negotiations. Indonesia may be seeking a grace period of about four years, but banks would be reluctant to allow debt repayment freeze for such a long period of time, analysts said. Creditors also want an agreement on how to finance the framework and on who would assume the foreign exchange losses that could arise if social unrest continued in Indonesia. The recent spate of riots across the nation could make any compromise on a grace period more difficult by slowing the rupiah's recovery, said Nobehara of Japan Research.<<

To: tom who wrote (3613)	5/18/1998 8:51:00 AM
From: Thomas Haegin	Read Replies (1) \| Respond to of 9980

Tom, << Deutsche Bank said that it only had US$1bn exposure to Indonesia but I know that their country limit for Indonesia was US$3bn and in 1997 that they had asked head office to increase that to US$5bn! ie $1bn seems a little on the low side. >> If my memory serves me correctly, I read some months back that all German banks (Deutsche, Dresdner, Commerz, the Bavarians, the Landesbanks) owned a total of $15 bn to all S.E. Asia ex-Japan, but I can't remember any details or breakdowns. There may be a post of mine to this regard here, but don't ask me which msg#. Thomas