In Brief: Indonesia to Meet with Foreign Creditors

Indonesia is scheduled to meet with 13 foreign creditor banks Wednesday to discuss restructuring about $70 billion in Indonesian private-sector debt.

Indonesian companies have run into increasing difficulties in repaying bank borrowings following a collapse in the country's currency last year. Indonesia's inability to fulfill conditions set by the International Monetary Fund for the release of some $43 billion in financial aid has been a major obstacle to starting productive talks with banks. Banking sources predicted that an Indonesian restructuring could take considerably longer to achieve than the $24 billion debt restructuring deal arranged for South Korea in February.

Chase Manhattan Corp., Deutsche Bank, and Bank of Tokyo-Mitsubishi Ltd. are jointly leading the talks, which will take place at Chase headquarters in New York.

U.S. banks had $6.7 billion in exposure to Indonesia at yearend, according to the Federal Financial Institutions Examination Council. Chase, one of the largest U.S. creditors, has $2.6 billion in claims on Indonesian borrowers and financial counterparties.