Bank Mandiri Credit to PT PAL Has the Potential to Become Problem Loans?

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BataraNews.com-PT PAL is one of the debtors / companies in the PAL group, together with PT APESI, PT PSSI, PT GETI, and PT PMS, engaged in business:

• Designing, building, assembling (assembling), and repairing and maintaining ships, machinery and floating tools and equipment.

• Developing non-ship business in the fields of Balance of Plant (BOP), Steam Turbine, Diesel Engine, Off-shore Structure and other non-ship engineering.

PT PAL has been in contact with the bank as a subsidiary since 1986 (ex legacy BBD) and has been a debtor since 1987 (ex legacy BBD Cab Surabaya Tj. Perak). During the Bank Mandiri credit period (from 2004 to 2008), PAL has received several credit facilities (both Cash Loans and Non Cash Loans) which have been partially repaid.

Furthermore, it is known that in 2013 PT PAL submitted a loan restructuring application in accordance with the application letter Number B / 43/60000 / III / 2013 dated March 11, 2013. On that request SAM made a proposal in the form of a Credit Analysis Number (NAK) TFS.SAM Number /LWO.154/2013 dated July 26, 2013 and has been approved by the Credit Credit Restructuring Category A.4 in accordance with the Minutes of Decision of the Committee (RKK) dated July 29, 2013, with the following restructuring scheme:

• Extended period of 15 years (as of 2028)
• Basic installments are carried out per month starting July 2013 at 2028.

• Interest rate of 4% p.a and imposed in stages according to the ability of the company’s cash flow, with the payment scheme as follows: (a) Interest in July 2013-June 2016 is 1% p.a, the remainder is deferred; (b) Interest in July 2016-June 2019 is 2% p.a, the remainder is deferred; (c) Interest in July 2019-June 2028 is 4% p.a .; (d) The remaining interest that will be deferred will be used as a Suspended Interest Post (BYDT) and will be paid in installments in stages since 2022 bd in 2028.

• For all interest arrears that are available at the time the effective restructuring is made as a post of Charged Interest Arrears (TBYD) and installments in stages in conjunction with the principal installments.

• Some of the arrears of fines are combined with TBYD and the remainder (at the cut off date position of USD 17,164,783) along with arrears of existing fines. when the effective credit restructuring decision will be corrected / written off effectively it is booked after the debtor credit facility is paid off.

• Approved the scheme for the sale of stock materials for the construction of ships M-256 and M-257 both under the hand and through the auction mechanism of fiduciary execution and the results were used to accelerate installments of the loan principal.

Based on the documents held by the Railway Investigator Team, it is known that PT PAL’s credit is known to have problems as follows:

• First, the Transactional KMK facility with the underlying project of procuring 2 units of Double Skin Bulk Carrier (DSBC) ships 50,000 DWT-Lauterjung (M-256 & M-257) with a total contract value of USD58,000,000.00 risking becoming bad credit.

• Second, payment for the completion of 4 escort tug units (M-262, M-263, M-264, M-265) is not used to reduce debtor credit obligations for Transactional KMK facilities.

In the document held by the Railway Investigator Team, it was explained that on this issue, the Board of Directors of Bank Mandiri conducted (1) a meeting with PT PAL regarding PT PAL’s credit settlement plan, credit restructuring, seeking investors, and completing PT PAL’s obligations through an auction related to the M-vessel facility. 256 and M-257, and (2) billing, in connection with the four Tug Escourt ships that have been completed, but there is no repayment of facilities to Bank Mandiri.

However, PT PAL explained that there was a cost over run for the construction of four ships. To PT PAL, a warning letter regarding credit settlement has been given. (Fahad Hasan&Tim Investigatot KA)