Indonesian VP defends bailout plan on ailing bank Century

14:39, December 22, 2009      

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Indonesian Vice President Boediono defended his decision to save the ailing little-known Bank Century so as to avoid the country from plunged into bigger economy crisis, a local media reported Tuesday.

Speaking at a hearing with members of the parliament's team to investigate into the alleged scam in the bank's bailout, Boediono said that Indonesia was in a crisis when the 6.7 trillion rupiah (about 707.4 million U.S. dollars) bailout decision was made in November 2008.

Boediono served as the Indonesian central bank governor when the bailout plan was implemented.

"We had unstable reserves, banks stopped giving loans to one another, rumors about sick banks spread wildly, foreign exchange was fluctuating. The condition was exactly like that of the big crisis in 1997-1998," Boediono was quoted as saying by the Jakarta Globe.

The parliament inquiry team was made following the finding of irregularities in the bailout process. The team joined by 30 lawmakers has the rights to summon senior officials involved in the bailout plan.

Besides Vice President Boediono, the team had also summoned Finance Minister Sri Mulyani.

President Susilo Bambang Yudhoyono has rejected the team's call to deactivate Boediono and Sri Mulyani while the investigation is proceeding.

Many had alleged that the bailout fund went to the incumbent president's campaign team. President Susilo secured his second presidency term that would last on 2014 in the presidential election held mid this year.

Source: Xinhua
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