(Petaling Jaya, Thursday): Bank Bumiputra Malaysia Malaysia Bhd chief executive officer, Datuk Abdul Aziz Othman yesterday welcomed the government’s commitment to provide the needed RM750 million capital injection for Bank Bumiputra and stated that Bank Bumiputra "had long recognised the need to inject additional capital to strengthen its capitalisation to meet the growing competition in the industry".
Malaysians have enough of such gobbledegook, especially when taxpayers would have to cough out RM750 million to save Bank Bumiputra - and not the first time, but the third time in 12 years.
The first time Bank Bumiputra had to be rescued was in 1986 when Petronas had to pump in RM2.5 billion to bail it out of insolvency as the result of the RM2.5 billion Bumiputra Malaysia Finance (BMF) scandal and the second time in 1989, when Petronas pumped in another RM982 million after BBMB chalked up losses of RM1.06 billion that year largely due to a monumental provision of RM1.23 billion for non-performing loans.
The three bail-outs of Bank Bumiputra in 12 years would come to RM4.2 billion and Malaysians are entitled to tell those responsible for such gross mismanagement of the banking sector to spare the taxpayers - who are the real victims of such banking scandal and crisis - the gobbledegook of having "long recognised the need to inject additional capital to strengthen its capitalisation to meet the growing competition in the industry".
This is particularly so when only last August, Bank Bumiputra chairman Tan Sri Dr. Abdul Khalid Sahan that it was targetting a RM1 billion group profit before tax after achieving a RM724.3 million group profit before tax for 1996!
Surely the Bank Bumiputra Chairman and its chief executive officer should explain how a forecast RM1 billion group profit before tax had dissipated into a situation where Bank Bumiputra has to be rescued a third time with a RM750 million capital injection from the government instead of the gobbledegook by Abdul Aziz yesterday.
Malaysia cannot continue to have "heinous crimes without criminals" involving billions of ringgit which will make a mockery of the principles of accountability, transparency and responsibility in the country!
The same applies to the case of Sime Darby, which reported yesterday a group pre-tax loss of RM1.81 billion for the half year ended Dec. 31, 1997, a day after Bank Negara announced that Sime Bank had incurred an astounding pre-tax loss of RM1.57 billion in the six months to Dec 31 last year and that it needs a fresh capital injection of RM1.2 billion.
Only last December, Sime Darby group chief executive Tan Sri Nik Mohamed Yaacob said that "Sime Bank has taken steps to ensure that the commercial bank can withstand the effects of the economic slowdown, with more effective loan portfolios monitoring, including freezing certain loans, especially those to the non-productive sectors", after announcing a RM250 million injection into SimeSecurities to lift the KLSE trading restriction imposed on its stockbroking arm.
Nik Mohamad had said on 12th December 1997: "Sime Darby will ensure that the new management structure and team in the financial subsidiaries will be effective in dealing with the downturn in the regional economies as the rest of the well-diversified Sime Darby Group".
What has happened to the solemn assurances given by the corporate chief of Sime Darby in a matter of less than three months, or are Malaysians to begin to disbelieve and distrust solemn statements and assurances given by corporate and banking leaders in the country?
The time has come for the nation to demand higher standards of banking and corporate governance and heads must roll for those responsible for the latest banking and financial crisis involving billion-ringgit losses. At the very least, there must be a total shake-up and revamp of the various boards of managements who have fallen short of maintaining high standards of banking and corporate governance to avoid repeated banking and financial crisis and scandals in the country.