TCRAP_Public/000322.MBX      T R O U B L E D   C O M P A N Y   R E P O R T E R

                            A S I A   P A C I F I C

              Wednesday, March 22, 2000, Vol. 3, No. 57


* A U S T R A L I A *

AMP: Watchdog APRA growls at AMP breaches
ASTRO CINEMA: Sale 'lost' taxpayers $850,000
BELL GROUP: Woodings takes reins of case
BOND CORP.: Hunt for $13m art dogs Bond
GREYHOUND PIONEER: Troubled company crashes into red
MAYNE NICKLESS: Chiefs defend falling share price
SOUTHERN EQUITIES: Hunt for $13m art dogs Bond

* C H I N A  &  H O N G  K O N G *

i-CABLE COMMOS.: Loss expected for 'partner-shy' firm
KWONG YEE FORWARDER LTD: Facing winding up petition
LA INN LTD: Facing winding up petition
PACIFIC RAINBOW (CHINA) LTD: Facing winding up petition
PROFIT TECH ENTERPRISES LTD: Facing winding up petition
RAINBOW CONCEPT HOLDINGS LTD: Facing winding up petition
RICH COST LTD: Facing winding up petition
SUPERSTAR CONTRACTORS LTD: Facing winding up petition
SUPER WORTH TRADING LTD: Facing winding up petition
TREND NETWORK CO.LTD: Facing winding up petition

* I N D O N E S I A *

PT BAKRIE FINANCE CORP.: Share to remain suspended
PT BAKRIE FINANCE CORP.: Survives second bankruptcy threat
PT BANK MANDIRI: Suffers loss of Rp38.86 Tril.
PT BANK NEGARA: Suffers loss of Rp10.2 Tril

* J A P A N *

DAI-ICHI SECURITIES CO.: To take loss on Towa merger
TAIHEIYO SECURITIES CO.: To take loss on Towa merger
TOKYO NISSAN AUTO SALES CO.: To remain in red for FY99
TOSHIBA CORP.: Intends to pare work force by 13%
UNIVERSAL SECURITIES CO.: To take loss on Towa merger

* K O R E A *

CHO HUNG BANK: FSS probes London branches
CHO HUNG BANK: Extend Daewoo loans or be fined
HANVIT BANK: Extend Daewoo loans or be fined
KOREA DEVELOPMENT BANK: Extend Daewoo loans or be fined
KOREA EXCHANGE BANK: FSS probes London branches
KOREA LIFE INSURANCE CO.: W3Tril. needed for bailout
KOOKMIN BANK: FSS probes London branches
NARA BANKING CORP.: Public tab for bank downfall W3.4T
SAMSUNG MOTORS: Creditors not budging on price
SAMSUNG MOTORS: Price feud may spur open bidding
SAMSUNG MOTORS: Renault promises $500M investment package
SEOUL BANK: W3Tril. Needed for bailout
SHINHAN BANK: FSS probes London branches

* P H I L I P P I N E S *

NATIONAL POWER CORP.: Senator scolds generator turnover
NATIONAL STEEL CORP.: Resumption of opertions proposed
PHILIPPINE NAT.BANK: HK fund manager asked to sell stake
VICTORIAS MILLING CO.: No investors for major sugar miller

* S I N G A P O R E *

IRIDIUM: Curtains come down on Iridium service today

* T H A I L A N D *

BANGKOK MASS TRANSIT SYSTEM: Share offering to pay debt
iTV PLC: Nation likely to announce iTV pullout
NAKORNTHAI STRIP MILL: Restructuring ahead
NTS STEEL GROUP: Restructuring ahead
SRIRACHA HARBOUR: Restructuring ahead
SUN TECH GROUP: Restructuring ahead
THAI CAPITAL FINANCE: Gov't orders its closure


AMP: Watchdog APRA growls at AMP breaches
AMP has been admonished by the Australian Prudential
Regulation Authority for 24 breaches of the regulator's
prudential and regulatory requirements.

In a document obtained by the Herald, APRA outlined its
concern to the AMP about the numerous breaches, including
statutory solvency requirements.  The APRA move comes in
the wake of speculation over the past week about the
company's capital adequacy, with the suggestion - denied by
AMP - that it may need as much as $5 billion in fresh

It is understood the UK regulator, the Financial Services
Authority, has expressed concern about similar breaches in
the UK.  APRA executive general manager, Mr Tom Karp, wrote
to AMP earlier this month saying he was worried the group
was not complying with the regulations for banks and

Many of the breaches relate to GIO - which has been in
breach of statutory solvency requirements - but others
relate to AMP Limited, AMP General Insurance, AMP Asset
Management and AMP Bank.

"In a recent conversation I noted that I was concerned that
there were numerous breaches of regulatory requirements
that were occurring within entities of the AMP Group," Mr
Karp's letter says.  "Many of these are not critical issues
and if considered in isolation would not concern me
greatly. However, the combination of them all is concerning
because the impression it leaves is that across a number of
AMP's entities there is not enough focus on understanding
and complying with regulatory requirements.  We expect the
major institutions which we supervise to have internal
mechanisms which ensure that requirements across the group
are understood and complied with."

APRA declined to comment on its dealings with AMP, whose
shares yesterday surged nearly 8 per cent on rumours
Westpac was planning a takeover.  However, AMP chief
financial officer, Mr Marc de Cure, said most of the
breaches had since been rectified.

"All these issues have been addressed or they are being
resolved," Mr de Cure said. "They are just normal, routine,
regular stuff that happens between companies and a
regulator. Every one of our subsidiaries is properly
capitalised. The regulator has no concern with our
capitalisation of our group entities."

The issue of AMP's capital levels was raised last week by
BNP Equities which said the group was a "sell" because it
would need to raise capital.  The BNP report - which had to
be modified due to calculation errors - was dismissed by
most analysts but one source close to the situation
yesterday agreed with it saying AMP is indeed
undercapitalised and is considering either a rights issue
or selling assets to fund the capital shorfall.

The source said GIO is likely to require a further capital
injection and that recent UK acquisition NPI would require
up to ú500 million ($1.3 billion).

"BNP's calculations were a bit wrong but the conclusion was
quite right," the source said. "The company has a need for

However, Mr de Cure said: "There is absolutely no plans to
raise capital. The reverse would be true. One of our major
strategic initiatives this year is to drive the use of
capital out of the business. We believe AMP can be far more
aggressive with its capital management and actually run the
existing businesses with less capital. The last thing we
want to do is raise capital. Whilst we could raise more
debt, we don't want to do that either."

APRA's list of complaints:

AMP Ltd: Apparent oversight of requirement for APRA
approval of dividend payment.

GIO Insurance: In breach of statutory solvency requirements
since June 30, 1999.

GIO General: Breached statutory requirements at December
31. Problem since rectified.

AMP General Insurance: In breach of reinsurance guidelines
as at September 30.

Superannuation: Some AMP funds have committed trustees to
honour client's instructions on death benefit payouts
without complying with SIS requirements.

AMP Asset Management: Apparent inappropriate funds
withdrawal (and eventual refund) from account of Top
Quartile Management in November.

AMP Bank: Failure to detect apparent breach of Banking Act
requirement for assets in Australia to exceed deposit
liabilities from February to July last year. (Sydney
Morning Herald  21-March-2000)

ASTRO CINEMA: Sale 'lost' taxpayers $850,000
The sale of the Astro cinema at Mt Druitt in May 1997 to
Hoyts by the receiver Mr Ken Rennie was made at up to $1
million less than the best price offered, the NSW Supreme
Court was told yesterday.

The deal, approved by the mortgagee, Colonial State Bank,
delivered Hoyts a cinema monopoly in Mt Druitt and cost NSW
taxpayers $850,000 in loan loss compensation paid by the
NSW Government to Colonial State Bank under an indemnified
loan agreement struck when the bank was sold by the then
State Government in 1994.

In 1996 Hoyts had opened its own cinema complex at Mt
Druitt. The Astro had not opened its doors as a cinema
again.  The course of the controversial sale transaction
was unravelled in the court as Colonial's asset manager Mr
Phil Soulos recounted under cross-examination the
negotiations leading up to the cinema sale.

Colonial State Bank is seeking possession of a Strathfield
home and a Campbelltown surgery owned by Mrs Kit Chia, the
wife of a former Colonial State Bank borrower, Dr Peng Tin
Chia, who owned the Astro. The possession order is pursuant
to third-party mortgages signed by Mrs Chia to support her
husband's loan from the bank. Dr Chia and Mrs Chia are
cross-claiming against the bank and the receiver it
appointed to the cinema, Mr Ken Rennie of accountants Ernst
& Young.

The court was told yesterday that Dr Chia had offered to
pay the bank $3.3 million in settlement of his outstanding
debt to the bank, in a deal that involved refinancing the
loan and buying back the Astro, which he had owned and
managed before the receiver took charge of it.

A number of buyers tendered for it, including Hoyts. The
court was told on Friday that Mr Rennie was acquainted with
Hoyts's managing director.  Mr Soulos said he was unaware
Mr Rennie had developed a proposal for Hoyts to buy the
cinema and close it down, thus giving Hoyts a monopoly in
the Mt Druitt area.

Hoyts had offered $2.3 million via a fax at 5.07am on
Saturday, May 3, 1997, two days before tenders for the
cinema closed.  On Monday, May 5, Dr Chia had offered to
pay $2.75 million plus shares in two properties to bring
the total to $3.3 million to settle his debt with the bank.

Mr Soulos, under cross-examination by Mr Raoul Wilson,
counsel for Dr Chia, agreed that he had given Dr Chia's
negotiator, Mr Charles Platcher, the impression on May 5
that Dr Chia's offer was being considered.

However, Mr Soulos had formed the view that whatever amount
Dr Chia offered to settle the debt and regain control of
the Astro would be affected by Dr Chia's difficulty in
servicing the debt, and in any event he did not want Dr
Chia to buy an asset "from himself".

Mr Soulos said he felt Dr Chia's offer was a "fabrication"
which contained words that had been "whited out", which did
not appear to be genuine and which was almost a "forgery".
Instead, the bank accepted the considerably lower Hoyts
offer at 4.55pm on May 5.

Colonial State Bank claims that Dr Chia still owes it $2.7
million, even after the sale of the cinema and the $850,000
write off by the State Government.  The claimed debt
figure, which the bank is seeking to have paid out by
seizing the home and the surgery, is being contested by Dr
Chia.  The hearing continues. (Sydney Morning Herald  21-

BELL GROUP: Woodings takes reins of case
On 17 March 2000, the Supreme Court of Western Australia
(WA) has put Tony Woodings in charge of the $A1B Bell Group
liquidation litigation.

Woodings, of Taylor Woodings, will investigate
PricewaterhouseCoopers' (PWC) acceptance of a retainer from
banks fighting 1995 proceedings. The Bell Group's other
liquidator, Geoff Totterdell from PWC, who is believed to
have applied to resign in December 1999, has been ordered
to assist Woodings "in respect of those Federal Court
proceedings brought against a consortium of six Australian
banks led by the Westpac Banking Corporation and 14
European Banks led by Lloyds Bank."

The Bell Group owned a range of assets, including Bell
Resources, until Alan Bond, siphoned off $A1.2b, for which
he was jailed. When Bell collapsed, the banks took $A282m
leaving nothing for creditors, resulting in the litigation,
with the banks represented by Freehill Hollingdale Page and
the creditors by Blake Dawson Waldron.  (The West
Australian  18-March-2000)

BOND CORP.: Hunt for $13m art dogs Bond
SOUTHERN EQUITIES: Hunt for $13m art dogs Bond
Alan Bond faces further legal action in 2000 from a British
liquidator trying to recover three valuable portraits.
Richard England, liquidator for Southern Equities, formerly
the collapsed Bond Corp, has spent four years trying to
find works worth about $A13m in an assets retrieval action
against Bond.

England is expected to resume civil action against Bond to
recover a portrait of navigator Matthew Flinders, the James
Cook portrait, and a portrait of Alexander Dalrymple, an
18th century British navy hydrographer involved with early
Australia. (The Age  20-March-2000)

GREYHOUND PIONEER: Troubled company crashes into red
Greyhound Pioneer published on 16 March 2000 a $A1.7m loss
for the December half, compared with the previous $A1.4m

For the six months to December 1999, sales went up 3% to
$A29.6 million, with the bus company indicating this was
due to coach sales from manufacturing subsidiary,
Queensland Coach Company. Greyhound Pioneer chairman
Stephen Jones commented that "untoward events" had
contributed to the loss.

Jones added that it would be hard to forecast a change in
direction of the company until several things were settled.
These included Greyhound's default on funds owed to some
companies, a bid from rival coach company McCafferty's, and
a McCafferty's price war. Greyhound did not declare an
interim dividend. (The Courier-Mail  17-March-2000)

MAYNE NICKLESS: Chiefs defend falling share price
Mayne Nickless yesterday defended its falling share price
and 1998 decision to quit its 25 per cent stake in Cable &
Wireless Optus.

Before about 200 Mayne investors at the Melbourne
Convention Centre, the chairman, Mr Mark Rayner, and the
managing director, Mr Bob Dalziel, tried to soothe anxiety
about the company's prospects and direction.  Investors
were also denied the chance for face-to-face talks as the
directors and executives caught a plane to Brisbane for a
repeat performance to Queensland stakeholders as part of a
week of briefings.

The meetings come with Mayne rumored as vulnerable to
takeover, although Mr Rayner dismissed the chances of a
single bidder because of the operational spread from
hospitals and diagnostics to cash and transport logistics.
Mr Rayner said the continuing fall in the company's shares
was due to a combination of poor performance and a disdain
for "old economy" stocks.

He repeated the Mayne argument that it believed it had
begun to turn around, even though almost half of its
hospitals portfolio was still under-performing.  He also
reiterated that the sale of the Optus stake had worked in
shareholders' favor, if they had taken up the shares and
held them.

"There has been recent ill-informed comment on whether the
divestment was the appropriate decision by the company," Mr
Rayner said.  "From the board's perspective, it was the
right decision, given that our 25 per cent CW Optus
shareholding was a passive, minority investment which
represented a continuing major demand on capital."

Most shareholders present were focused on Mayne not
producing any further large abnormal charges in its next
set of accounts, and wanting assurances that dividend would
not be sliced again.  Mayne shares rose 6.5 cents to $3.445
yesterday. (The Age  21-March-2000)

C H I N A  &  H O N G  K O N G

i-CABLE COMMOS.: Loss expected for 'partner-shy' firm
Analysts expecting i-Cable Communications to announce today
a full-year loss of up to $590 million hope the company
will be more active in forging alliances.

For the interim period to June 30 last year, i-Cable made a
loss of $201 million.  The full-year loss to December 31,
1998 was $724 million.   The 79.2 per cent-owned Wharf
(Holdings) unit might announce a full-year loss of $590
million, a figure that would exceed the forecast of a $450
million loss in its listing prospectus, CLSA predicted.

Other analysts said the larger than expected loss could
come from the roll-out of i-Cable's Internet service.
The company added 54,000 subscribers to its core cable
business last year, boosting the number to 450,000, the
analysts said.

The share price of i-Cable, which made its debut last
November, has dropped 35 per cent in less than four months.
Yesterday, before the results announcement, the stock
gained 7.93 per cent after touching a record low of $5.85.
It closed at $6.80.

Analysts criticised i-Cable management for its failure to
secure alliances and partnerships to expand its cable and
Internet networks.  They cited an instance wherein i-Cable
had invited five other firms to join an alliance while it
was still courting Commerce One, the US business-to-
business Internet company.

"They [i-Cable] should have got the deal first," said an
analyst, who asked not to be named. (South China Morning
Post  21-March-2000)

China Huarong Asset Management Corp has agreed to conduct
100 billion yuan (S$20.6 billion) in debt-for-equity swaps
for the Industrial and Commercial Bank of China (ICBC), the
Financial News reported yesterday.

ICBC, China's largest state-owned bank, transferred the 100
billion yuan in bad debts to Huarong last week, the
official newspaper said. China formed four asset management
companies -- Huarong, Cinda, Dongfang, and Great Wall --
last year to tackle mounting bad loans at its major state
banks and reduce the debt burden of state-owned

They are expected to take over more than one trillion yuan
in non-performing loans issued by the banks to state-owned
enterprises and try to recover them through debt-for-equity
swaps.   The swaps are believed to be the major method for
recovering the bad loans and relieving the debt burden,
analysts say. But state media say the scheme has been held
up by resistance from local government officials.
(Singapore Business Times  20-March-2000)

KWONG YEE FORWARDER LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 26 on the petition of
Chung Yiu Chuen for the winding up of Kwong Yee Forwarder
Limited. A notice of legal appearance must be filed on or
before April 25.

LA INN LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 12 on the petition of Yip
Kwai Mui for the winding up of La Inn Limited. A notice of
legal appearance must be filed on or before April 11.

PACIFIC RAINBOW (CHINA)LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of
Standard Chartered Bank Limited for the winding up of
Pacific Rainbow (China) Limited. A notice of legal
appearance must be filed on or before April 4.

PROFIT TECH ENTERPRISES LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for March 29 on the petition of Mak
Sau Fong for the winding up of Profit Tech Enterprises
Limited. A notice of legal appearance must be filed on or
before March 28.

RAINBOW CONCEPT HOLDINGS LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of
Standard Chartered Bank Limited for the winding up of
Rainbow Concept Holdings Limited. A notice of legal
appearance must be filed on or before April 4.

RICH COST LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 12 on the petition of
Standard Chartered Bank Limited for the winding up of Rich
Cost Limited. A notice of legal appearance must be filed on
or before April 11.

SUPERSTAR CONTRACTORS LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of Sun
Fook Kong (Civil) Limited for the winding up of Superstar
Contractors Limited. A notice of legal appearance must be
filed on or before April 4.

SUPER WORTH TRADING LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for April 5 on the petition of Top
Glory Finance Limited for the winding up of Super Worth
Trading Limited. A notice of legal appearance must be filed
on or before April 4.

TREND NETWORK CO.LTD: Facing winding up petition
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for March 29 on the petition of The
Hongkong and Shanghai Banking Corporation Limited for the
winding up of Trend Network Company Limited. A notice of
legal appearance must be filed on or before March 28.


PT BAKRIE FINANCE CORP.: Share to remain suspended
The Jakarta Stock Exchange said shares of PT Bakrie Finance
Corp will remain suspended despite a decision last week by
the Jakarta commercial court to reject a 13.45 mln usd
bankruptcy suit against the company.

"The status of PT Bakrie Finance Corporation's shares
suspension will be decided when the Jakarta Commercial
Court decides on an appeal," the JSX said, without giving
further details.

The plaintiffs in the bankruptcy suit are AB Capital
Markets (Hong Kong) Ltd, Cho Hung Leasing and Finance (Hong
Kong) Ltd, Hanmi Leasing and Finance (Hong Kong) Ltd, and
KEB Leasing and Finance Ltd.  (AFX News Limited  20-March-

PT BAKRIE FINANCE CORP.: Survives second bankruptcy threat
Finance company PT Bakrie Finance Corporation (BFC) has,
for the second time, survived a bankruptcy threat at the
Jakarta Commercial Court, a lawyer said.

Joni Aries Bangun, a lawyer representing four foreign
creditors, said on Monday that the court was biased in its
verdict as it only accepted BFC's legal arguments.

"The court completely ignored all our arguments," Joni

The court rejected last week the US$13.5 million bankruptcy
claim filed by the four foreign creditors on the grounds
that the plaintiff did not represent the majority of

"The bankruptcy claim should be rejected because the suit
is not supported by at least two-thirds of the creditors,"
said the court verdict.

The four Hong Kong-based creditors, AB Capital Markets
Ltd., Cho Hung Leasing & Finance Ltd., Hanmi Leasing &
Finance Ltd. and KEB Leasing and Finance Ltd., and another
four financial institutions agreed in April 1996 to provide
$21 million in a syndicated loan to BFC. But BFC failed to
repay the loan, which matured on May 3, 1999.

The bankruptcy suit was the second filed by the four
companies. Their first attempt, which was filed in August
last year, was also rejected due to a technical matter.
Joni denied his clients needed the majority approval from
the other syndicated creditors to file the bankruptcy suit.

"Our clients -- in the context of protecting their own
rights -- are acting independently from the other
creditors," Joni said.  "Each amount outstanding at any
time from the borrower to each lender or the agent shall be
a separable and independent debt and every lender and the
agent shall have the right to protect and enforce its
rights arising out of this agreement," Joni said quoting
the agreement between the syndication and BFC.

Joni said his clients might file an appeal. "The decision
whether to file an appeal will be made tomorrow (Tuesday)."
Analysts have said Indonesia has a relatively good
bankruptcy law, but the implementation of law by the
country's judges was still poor. (The Jakarta Post  21-

PT BANK MANDIRI: Suffers loss of Rp38.86 Tril.
PT BANK NEGARA: Suffers loss of Rp10.2 Tril
Finance minister Bambang Sudibyo said on Monday that 20
state-owned companies suffered combined financial losses of
Rp 47.65 trillion (US$6.39 billion) last year.  The giant
Bank Mandiri experienced the largest loss of Rp 38.86
trillion, followed by the publicly listed Bank Negara
Indonesia (BNI) with Rp 10.20 trillion.

Speaking in a hearing with the House of Representatives's
budget committee, Bambang said the primary reason for
the losses of the state banks was the negative spread
between their interest expenses and interest earnings.
He also said that Bank Rakyat Indonesia (BRI) gained a
financial loss of Rp 1.41 billion in 1999.

Bank Indonesia stated in its 1999 annual report that the
country's banking sector was still in the red last year
although profitability had slightly improved, particularly
after domestic interest rates steadily declined.  The
central bank said the cumulative loss (before tax) of the
banking sector last year was Rp 91.7 trillion, but this was
48.68 percent lower compared to Rp 178.7 trillion in the
previous year.

Bank Mandiri is the country's largest bank and was formed
by the merging of four state banks last year -- Bank Bumi
Daya (BBD), Bank Dagang Negara (BDN), Bank Ekspor Impor
Indonesia (Exim), and Bank Pembangunan Indonesia (Bapindo).
The government completed Bank Mandiri's recapitalization in
1999 by injecting bonds worth Rp 178 trillion, boosting its
capital adequacy ratio (CAR) to more than 12.44 percent.

The bank is planning to launch an initial public offering
(IPO) early next year in a bid to raise $1.5 billion.
Bambang said he had agreed to the bank's IPO plans. The
finance minister represents the government as the
shareholder of state banks.  The government will also soon
recapitalize Bank BNI by injecting bonds worth Rp 52.8

The bank was hit last year by a controversy when a minister
alleged that former president Soeharto intervened in the
channeling of Rp 9.6 trillion in loans from the bank to the
textile conglomerate Texmaco Group.  Much of the loans have
now fallen into the bad loan category.

Bambang added that the airline PT Merpati Nusantara booked
a loss of Rp 48.70 billion, mainly because the rupiah-based
tariff could not cover its dollar-based operational cost.
He said other state-owned firms which suffered big losses
included paper company PT Kertas Letjes (Rp 193.65
billion), glass maker PT Industri Gelas (Rp 58.39 billion),
housing construction firm PT Pembangunan Perumahan (Rp 99
billion), and plantation firms PTPN XIV (Rp 39.37 billion),
and PTPN XI (35.65 billion).

Bambang stated that these companies were badly hit by the
high interest rate policy and suffered inefficiency due to
the out of date plant equipment.  He didn't report the
financial condition of the remaining 120 state firms.

Elsewhere, Bambang said the Indonesian Bank Restructuring
Agency (IBRA) had raised Rp 11.41 trillion as of January
2000 against its Rp 17 trillion target. Rp 3.67 trillion
had come from the sale of its fixed assets, Rp 5.51
trillion from the recovery of bank non-performing loans
(NPLs) under its management, and the remainder from other
revenue sources.

Around Rp 5.59 trillion is expected to be earned from the
sale of its 45 percent stake in the publicly listed auto
giant PT Astra International, along with the recovery of
NPLs and the selling of the government bank
recapitalization bonds.

"IBRA will be able to meet its Rp 17 trillion revenue
target in the current 1999/2000 budget year (ending this
month)," Bambang said. (The Jakarta Post  21-March-2000)


DAI-ICHI SECURITIES CO.: To take loss on Towa merger
TAIHEIYO SECURITIES CO.: To take loss on Towa merger
UNIVERSAL SECURITIES CO.: To take loss on Towa merger
Taiheiyo Securities Co. (8618), Dai-ichi Securities Co.
(8612) and Universal Securities Co. (8621) announced Friday
that they will book extraordinary losses when they merge
with Towa Securities Co. on April 1.

Taiheiyo will record a 5.38 billion yen loss, Dai-ichi will
book a 5.2 billion yen loss and Universal will report an
8.6 billion yen loss, all in the fiscal year ending March
2000.  The 19.2 billion yen of losses are due mainly to
valuation losses on fixed assets and payments relating to
tax-qualified pension programs.

The companies also announced their merger-related payouts
to shareholders. Taiheiyo and Dai-ichi will pay 5 yen per
common share, while Towa will pay 8 yen per share. (Nikkei

TOKYO NISSAN AUTO SALES CO.: To remain in red for FY99
Tokyo Nissan Auto Sales Co. (8291) said Friday it expects
to record a 2.4 billion yen net loss for fiscal 1999, its
seventh straight year in the red.

In November, the company said the sale of its Roppongi
headquarters building would put it back in the black and
enable it to erase all its past losses, but a continued
business slump, losses at affiliates, and shortfalls in its
pension funding will keep the company in the red.

Accumulated losses, which stood at about 8 billion yen at
the end of March 1999, now are expected to top 10 billion
yen by the end of the month this year. The company now says
it will use more asset sales to write off all of its
accumulated losses in fiscal 2000.

Its pretax loss for fiscal 1999 is now seen at 2.7 billion
yen, larger than earlier forecasts of 600 million yen.
Sales of new cars fell by 10% from the year before. The
firm will show a 13 billion yen extraordinary gain from the
sale of its headquarters. (Nikkei  21-March-2000)

TOSHIBA CORP.: Intends to pare work force by 13%
Toshiba Corp. will shrink its parent-company work force by
about 13% over the next three years to strengthen overall
operations, the company said.

The number of workers at the parent company will fall by
over 7,000 through regular retirement and employee
transfers to other businesses within the Toshiba group,
spokesman Keisuke Omori said.  There are 57,300 workers in
Toshiba's parent company. The company expects about 2,000
of those to retire each year, Mr. Omori said.

The number of workers within the Toshiba group will stay at
around 192,000, Mr. Omori said. The group compromises some
320 companies, including many tie-ups with major overseas
firms.  Mr. Omori said Toshiba has been trying to
reorganize its overall corporate structure, moving workers
around within the company and shifting the focus to new
sectors, in particular information technology.

"Our primary objective is (having) each respective business
increase competitiveness," he said.

Toshiba said last week it expected to post more losses on a
parent basis than it originally thought, after reserving
more money for retirement benefits and pensions. The
company revised its unconsolidated net loss forecast for
the year ending March 31 to a record 250 billion yen ($2.37
billion) from 65 billion yen. On a group basis, the company
forecast a smaller net loss of 30 billion yen on the back
of improved sales, versus an earlier loss forecast of 50
bilion yen. (The Asian Wall Street Journal  20-March-2000)


CHO HUNG BANK: FSS probes London branches
KOREA EXCHANGE BANK: FSS probes London branches
KOOKMIN BANK: FSS probes London branches
SHINHAN BANK: FSS probes London branches
The Financial Supervisory Service (FSS) is conducting a
special probe into branches of four domestic banks in
London.  Under investigation are London branches of Cho
Hung, Korea Exchange, Kookmin and Shinhan banks.

"In response to warnings by British supervisory authorities
against excessive competition, we are conducting a special
inquiry into the operations from March 11 to April 9," an
FSS official said.

In June and August last year, the financial watchdog
investigated London branches of Hanvit, Korea First and
Exim (Export-Import) banks.  Currently, domestic banks are
operating a total of 12 branches in the British capital.
(The Nation  21-March-2000)

CHO HUNG BANK: Extend Daewoo loans or be fined
HANVIT BANK: Extend Daewoo loans or be fined
KOREA DEVELOPMENT BANK: Extend Daewoo loans or be fined
Korean banks, including Korea Development Bank, Hanvit Bank
and Cho Hung Bank, may face fines for failing to extend
loans loans they pledged to six debt-ridden Daewoo Group
units, the government said.

Korea's Corporate Restructuring Coordination Committee,
which is overseeing Korea's corporate reforms, said it sent
warning letters to 30 banks and insurers, which may have to
pay penalties of up to 50 percent of the pledged loans or
30 percent of the firm's total Daewoo loans.

"After tomorrow, we will seriously consider imposing fines
on financial firms, which would not heed our call," said
Yoon Taek Ho, a CRCC official.

For the Korean financial firms, extending the loans would
mean taking on more exposure to the company whose decline
has crimped the banks' recovery from recession.

"Obviously the banks don't want to take on any more Daewoo
loans," said H. Jin Lee, an analyst at Samsung Securities

So far, financial institutions have made about 30 percent
of 5 trillion won ($4.5 billion) of loans pledged to Daewoo
Corp., Daewoo Motor Co., Ssangyong Motor Co., Daewoo Heavy
Industries Co., and Daewoo Telecom Co. and Daewoo
Electronics Co.   The units, which comprise what was once
Korea's second-largest industrial group, need the funds to
continue operating before they are sold. Daewoo Motor is
suffering the most severe cash-shortage problems as the
nation's No. 2 automaker lacks operating capital to pay its
parts suppliers, the CRCC said.

For Daewoo Motor, the money is even more critical as
General Motors Corp., Ford Motor Co., two of the world's
largest automakers, perform due diligence before submitting
bids for Korea's No. 2 automaker against three other auto
companies.  Most local banks, including state-run Korea
Development Bank, Hanvit Bank, Cho Hung Bank, Korea
Exchange Bank and Korea First Bank received the warning
letters, Yoon said.

"The government sent a signal to banks that it wants to
quicken the process of Daewoo revival plans," said Mok
Young Chung, a bank analyst at ING Baring Securities in
Seoul.  "It will be too burdensome for the government to
delay the Daewoo problems further," especially at a time
when the government is ready to press ahead with the next
round of financial reforms, he said. (Bloomberg  20-March-

KOREA LIFE INSURANCE CO.: W3Tril. needed for bailout
SEOUL BANK: W3Tril. Needed for bailout
Additional public funds of more than 3 trillion won ($2.68
billion) may be needed to put Seoul Bank and Korea Life
Insurance Co. back on track, financial sources said

However, the government is reportedly opposed to the
injection of more public funds into the two financial
institutions as a state fund for financial restructuring
has almost been depleted.

According to the sources, Seoul Bank is estimated to need
an additional public funds injection of around 1.8 trillion
won to turn it around.  The nationalized bank is thought to
need around 1 trillion won to clean up problem loans and
800 billion won to meet its liquidity shortage, said the

Seoul Bank loans of 1.81 trillion won to companies under
debt workout programs are deemed unrecoverable, while the
bank is also said to need liquidity reserves of at least
800 billion won to guard against a run on deposits.
Since 1998, the government has put a total of 4.5 trillion
won in public funds into Seoul Bank as part of efforts to
keep the bank afloat.

In addition to Seoul Bank, Korea Life Insurance Co. is
estimated to need additional public funds of 1.5 trillion
won.  As of the end of 1999, the nation's third largest
life insurer had liabilities exceeding assets by as much as
3.5 trillion won, while it held real estate was valued at
around 2 trillion won.

The government has injected 2.5 trillion won in public
money into the life insurer since negotiations to sell it
off to a foreign buyer fell apart last year.  The two
financial institutions have reportedly requested the
Financial Supervisory Commission (FSC) to invest additional
public funds.

FSC spokesman Kim Young-jae, however, denied such reports,
saying that Seoul Bank has not requested public cash since
September last year.  Another FSC official said the
government has no immediate access to public funds to be
put into the institutions. He added that about 10 trillion
won is left in the financial restructuring fund.

Analysts suggest it is inevitable for the government to
replenish the fund with additional public money in order to
preempt potential financial instability resulting from the
envisioned second-phase financial restructuring. (The Korea
Herald  21-March-2000)

NARA BANKING CORP.: Public tab for bank downfall W3.4T
The government will have to fork over W3.4 trillion to
cover deposits made at merchant bank Nara Banking Corp.,
whose operations have been suspended since January 25 by

According to the Financial Supervisory Service (FSS)
Monday, its audit of Nara revealed that the amount of
deposits which the government will have to cover can be
broken down to W300 billion for individual depositors, W1.5
trillion for corporate deposits and W1.6 trillion for other
financial institutions.

The FSS said the amount is the largest being paid out by
the government on behalf of liquidated financial firms
since the 1997 financial crisis. Thus far, the highest
amount of public funds that have gone towards the
liquidation of a financial firm is the W3 trillion which
went to covering deposits at Daehan Investment Banking
Corp. (Digital Chosun  20-March-2000)

SAMSUNG MOTORS: Creditors not budging on price
Ahead of a new round of negotiations with French carmaker
Renault, creditors of Samsung Motors Co. said Monday they
have no plans to lower the price of the bankrupt South
Korean car firm.

"Our initial offer still stands, and we have no plan to
change that," said an official at Hanvit Bank, the main
creditor bank of Samsung Motors. He spoke on customary
condition of anonymity.  Officials of Samsung and its main
creditor banks are scheduled to travel to Paris next week
to hold a second round of negotiations on the selloff of
the Korean carmaker.

The first talks in Seoul earlier this month broke down when
Samsung's creditors rejected an offer by Renault to buy the
Korean company for $450 million. Samsung's South Korean
creditors had proposed a price of 695 billion won ($622
million).  Renault is the only firm that has shown interest
in buying Samsung. It has offered to create a 70-30 percent
joint venture to acquire Samsung Motors assets, including
the brand, plant, research center and the dealership

Samsung's South Korean creditors rejected media reports
that the last round of talks broke down because a large
amount of hidden debts of Samsung Motors owed to an
affiliate company had just been exposed. Renault knows
about all of Samsung's debts, creditors said.

Samsung Motors, a subsidiary of the giant Samsung Group,
entered the nation's already saturated auto market in early
1998 with an annual capacity of 240,000 cars.  It produced
only 50,000 cars in 1998 and a mere 2,000 in 1999 since
operations were halted during most of the year amid severe
financial difficulties.  With dlrs 4 billion in debt and
dlrs 3 billion in assets, Samsung was put under court
receivership in 1999.

Renault has been in takeover talks with Samsung since
December. It hopes that a takeover of Samsung Motors would
give it more access to the South Korean market and a larger
base in Asia.  (AP Worldstream  20-Mar-2000)

SAMSUNG MOTORS: Price feud may spur open bidding
Samsung Motors Inc. could be sold in an open auction unless
Renault SA and Samsung's creditors can narrow their
difference on the price of the troubled auto manufacturer,
according to Samsung's creditor bank, Hanvit Bank.A bank
official said Renault's right to be the exclusive
negotiating party runs out at the end of this month.

"If we can't narrow our differences by then, we will have
no choice but to put up Samsung Motors for an open bidding
auction," said the official, who asked not to be named.

Samsung's creditors have been complaining that Renault's
offer was too low. The French car maker earlier this month
made public a proposal to Samsung Group and creditors of
its car-making arm that the two companies set up a joint
venture to take over Samsung Motors. The joint-venture
company would buy the  assets of Samsung Motor for $450
million, and the proposal envisioned the new company would
be 70%-owned by Renault and 30%-held by Samsung Group. The
Hanvit official said Renault proposed to lay out $50
million in cash up front and pay the rest off in annual
increments based on Samsung Motors' annual
operating profit.

"That's likely to take more than 20 years to repay," said
the official.

He said Hanvit had proposed to sell Samsung Motors for 695
billion won ($622.2 million). That's a step back from the
trillion won creditors originally wanted.

"That is for most of the assets of Samsung Motors, but not
all. We have come down on the price to try and make this
work," said the official.

Although negotiations were at loggerheads in Seoul, the
Hanvit official said they hadn't broken down. "We are
expected to meet again in Paris to try to narrow our
differences," he said.

Officials at Samsung Group weren't available for comment
over the weekend, but they have previously said Samsung
would like to hold only about 20% in the joint venture with
Renault, rather than the proposed 30%.Renault, along with
other car makers such as General Motors Corp. and Ford
Motor Co., is eager to break into the Korean market, which
analysts say has great growth potential.

GM and Ford are currently vying for Daewoo Motor Co., an
affiliate of Daewoo Group. The group nearly defaulted under
89 trillion won of debt last year. While the sale of Daewoo
Motor to foreign companies is facing protests by labor
unions, auto-parts manufacturers and some politicians,
Renault has so far been welcomed to the southeast region of
South Korea, where Samsung Motors is based.

The official at Hanvit Bank has said people in that region
believe a  Renault takeover would help maintain the current
assembly line of Samsung's SM5 luxury sedans, which support
an intricate web of new auto-parts manufacturers. Taking
that away, they fear, could hurt the regional economy.
Samsung Motors is considered by some analysts to be the
most prominent example of corporate excess in South Korea.

Samsung pursued its automobile start-up despite world-wide
concerns about excess capacity in the industry. It began
marketing the vehicles in March 1998 amid South Korea's
worst recession and sought court protection from creditors
in June. (The Asian Wall Street Journal   20-March-2000)

SAMSUNG MOTORS: Renault promises $500M investment package
French auto giant Renault said Monday it will invest 500
million dollars (euros) over four years in Samsung Motors
if it takes control of the failed South Korean group.

The statement was issued after negotiations between South
Korean creditors and Renault officials reportedly all but
collapsed over a dispute over the price of the deal. An
official from Hanvit Bank, Samsung Motors' main creditor,
told AFP in Seoul that Renault's bid was destined for
failure if it did not increase its proposed initial cash
payment offer.

Renault made a 450-million-dollar bid for Samsung Motors on
March 6, to create a company owned 70 percent by the French
giant and 30 percent by Samsung.

Monday, in Paris, a Renault spokesman said: "As well as
buying (Samsung Motors') operating assets, the new company
will need to invest 500 million dollars over the next four

The merged company's initial capital--put at 335 million
dollars, of which Renault would contribute 235 million and
Samsung 100 million--would provide the bulk of the
investment package, he said.  It was not clear how the
remaining 165 million dollars would be raised.

The spokesman added that Renault was "very surprised by the
comments made by the creditors in the Korean press,
particularly since it (Renault) had not received an
official refusal of its offer."

He also pointed out that Samsung Motors' operating assets
had little value except for what they could produce in
future.  "The Renault delegation has returned to Paris,"
the company spokesperson said. "The negotiations have not
broken down and should resume shortly, although the date
and the location have not yet been fixed."

Renault has exclusive rights to the merger negotiations
until March 31.  Seoul's Yonhap News Agency reported that
the next round of talks was expected to take place in the
French capital on March 25. (China Daily  21-March-2000)


NATIONAL POWER CORP.: Senator scolds generator turnover
In a move described by Sen. Sergio Osme§a III as
unprecedented, irregular, irresponsible, and illegal, the
National Power Corp. transferred a 150-MW generating unit
worth $150 million to the Argentine firm IMPSA/CBK Power
Corp. which has a paid up capital of only P250,000.

Osme§a disclosed that last Feb. 7, Napocor president
Federico Puno ordered the turnover of Kalayaan Unit 2 of
the Caliraya-Botocan-Kalayaan (CBK) hydro-electric power
complex to IMPSA/CBK without a valid contract in place and
without collecting the $70-million security deposit.

Osme§a claimed that Puno had signed a vaguely-worded
supplemental agreement with IMPSA officials last September
1999 without having obtained prior Napocor board approval
which was secured only in November. Neither did Puno send
the supplemental agreement to the NEDA-ICC for review in
violation of the procedure laid down by the BOT Law.

"The principal agreement covering the Build-Rehabilitate-
Operate-Transfer (BROT) project for the CBK complex is not
yet effective for failure of the IMPSA to raise financing,
to pay up its equity, and to remit the $70 million security
deposit to Napocor," Osme§a argued. He said that a
subsidiary contract cannot therefore be effective. "If the
behest contract has not been legalized, then the behest
baby must be illegitimate."

The principal CBK contract was attended by much controversy
when it was signed on Nov. 16, 1998 in Malaca§ang with
President Estrada as witness. A news daily which had
described the President as the "unwitting godfather" of the
contract was forced to shut down while its ownership
changed hands.

Osme§a said that Puno's move was unprecedented because no
government contract has ever been implemented on the basis
of a subsidiary or supplemental agreement which has no
effective principal contract to stand on.

"Puno may be charged with violation of the Anti-Graft and
Corrupt Practices act for entering into a transaction
grossly disadvantageous to the Filipino people," Osme§a
declared. "I will furnish more juicy details when I deliver
my privilege speech this afternoon on this matter."

In response, IMPSA said the Kalayaan Unit 2 unit was turned
over because the transformer was on the verge of collapse,
as detected by more than 20 tests conducted last year by
Napocor and the private firm.  IMPSA Asia Ltd. president
Ruben Valenti explained that tests conducted since March
1999 showed an alarming progress of the defect.

"According to the International Electrical Engineers
Standards, the transformer was in Condition 4, which means
it should be removed from service," Valenti said in a
statement. "The international standard indicated a 'thermal
decomposition fault,' which was reconfirmed when the
transformer was opened last month."

He said it was a wise and prudent decision to stop Unit 2
because destruction of the transformer could have resulted
as a consequence of a short circuit.

"The occurrence of a collapse was imminent. There was
melted insulation and irreparable damage could have
occurred," Valenti said.

He explained that while there are some precedents that
Napocor could not deliver because of the case pending in
court, the power firm cannot afford to risk the collapse of
Kalayaan. (The Philippine Star  21-March-2000)

NATIONAL STEEL CORP.: Resumption of opertions proposed
Grupo F Jacinto filed a proposal to resume operations of
National Steel Corp, mainly involving a management contract
for the operation of viable facilities, according to
documents filed with the Securities and Exchange

In a letter to the National Steel receivership committee,
Grupo Jacinto said to rescue the steel company from
permanent collapse "a management contract arranged with the
committee to once more operate the retrieved chattels
from National Steel appears to be the most practical

Under the proposal, 10 mln usd, to be financed by banks,
will be needed for start-up operations and a further 30-50
mln usd working capital will be required for raw material
purchases.  Up to 20 pct of annual profits will be used to
cover part of creditor banks' losses, the group said.

The consortium would be led by Grupo F. Jacinto and its
members include Bacnotan Steel, Puyat Steel and other
members of the Filipino Galvanizers Institute. The
consortium also includes an alliance of investors from
Singapore and Hong Kong.

As this developed, the Securities and Exchange Commission
(SEC) is making sure no foreclosure proceedings take place
before the steel maker's receivership committee presents
its assessment of the firm's viability on March 24. This,
as the temporary debt reprieve issued by the SEC has
recently lapsed. SEC chairman Perfecto R. Yasay, Jr. said
there would be no foreclosure proceedings against NSC for
as long as the interim receivership committee is in place.

The three-member body composed of former SEC commissioner
Monico V. Jacob, former National Power Corp. president
Guido Delgado, and former NSC chief executive officer
Antonio Arizabal, has taken charge of the assets,
properties and facilities of NSC. Following the backing out
of the two potential Russian investors, the interim
committee has been given until Friday to assess NSC's
status and the viability of its rehabilitation.  (AFX News
Limited  20-March-2000, Business World  21-March-2000)

PHILIPPINE NAT.BANK: HK fund manager asked to sell stake
The Government will formally ask Hong Kong-based fund
manager Templeton Asset Management to sell its 12.9-percent
stake in Philippine National Bank together with the
holdings of the state and Lucio Tan.

Finance Secretary Jose T. Pardo yesterday said he would
convey the government's request to Templeton this week in
his response to the latter's inquiries about the status of
the PNB privatization plan.

"I will formally ask Templeton to join the government and
Tan in selling the PNB shares so we could bring the value
of PNB higher," Pardo said.

The government has to sell its remaining 30 percent in the
bank on or before June 30.  Tan has committed to sell his
46-percent stake in PNB for P160 per share. A team from DOF
is drawing up a shareholders' agreement to bind the taipan
to his commitment to sell.

Pardo said the parallel audit that the DOF had asked PNB to
commission should ensure that there would be no hidden
items in the balance sheet that could create problems
later.  The audit to be done by SGV & Co. should already
serve as due diligence for potential buyers of the bank.
Pardo said the government would also convince the PNB
Retirement Fund to sell its 4.5-percent stake in the bank.

SGV & Co. will double-check the findings of the bank's 1999
auditor Punongbayan and Araullo on the state of the bank's
finances. On top of this, the Bangko Sentral ng Pilipinas
would conduct next month its annual audit of PNB's books
ending March 31.  US firm Price WaterhouseCoopers did an
audit of PNB's finances as of end-1998.

The US audit firm was the third party recommended by the
World Bank to conduct the audit of PNB's finances in
preparation to the government's divestment of its remaining
30-percent stake in the bank before July.  The audit has
yet to be accepted by the bank's board because the findings
revealed that PNB's finances were in a bad state.

Pardo said the DOF wanted an audit of PNB in the last six
months to find out the real state of its finances before it
would be offered for sale.  PNB is banking on its huge
branch network and deposit base, particularly from overseas
Filipino workers, to prop up its value.

However, its nonperforming loan ratio of 29 percent based
on its own audit and 40 percent based on the Price
Waterhouse audit has been adversely affecting the bank's
marketability.  The Price Waterhouse audit also revealed
that the bank's earning assets were less than half of its
total assets worth about P200 billion and that more than 10
percent of PNB's assets had been foreclosed.

PNB said its new management team was bent on improving the
quality of the bank's loan portfolio, tighten its credit
process, and intensify the collection of past due loans.
(Philippine Daily Inquirer  21-March-2000)

VICTORIAS MILLING CO.: No investors for major sugar miller
There were no takers for the country's biggest sugar

Yesterday's public auction for a controlling 53.35% stake
in beleaguered sugar miller Victorias Milling Company
resulted in a failed bidding after the two remaining
potential investors did not submit a bid, BusinessWorld
sources said.  Up for grabs were 567 million new Victorias
shares that were to raise some 567 million Philippine pesos
($13.84 million at PhP40.957=$1) in fresh capital for the

The company, whose production accounts for almost 46% of
the country's sugar output, owes 32 creditor banks some
PhP5.07 billion ($0.124 billion) as against total assets of
PhP7.1 billion ($0.173 billion).   With the failed bidding,
the rehabilitation plan approved by the Securities and
Exchange Commission cannot be implemented since the plan
depends on the much-needed equity infusion, the sources

Initially, five companies expressed interest in Victorias.
These were the Gokongweis' JG Summit Holdings, Inc.;
Alliance Global Group, Inc.; agribusiness firms Cargill
Philippines, Inc. and Binalbagan Isabela Sugar Co.
(Biscom); as well as the consortium of RCBC Capital Corp.
and Central Azucarera Don Pedro.  Of the five, however,
only Cargill and the RCBC Capital-Central Azucarera
consortium prequalified.

"(But) no one submitted a bid bond," the source said.

Bidders were supposed to deposit at least 10% of the base
price of the Victorias shares to be auctioned off in an
escrow account with any of the accredited banks, the
management committee said.  Accredited banks were Bank of
the Philippine Islands, Deutsche Bank AG, Equitable PCIBank
and East West Banking Corporation.

In an earlier interview, Victorias' management committee
chairman Isidro C. Alcantara, Jr., who is now president of
Philippine Bank of Communications, said in the event of a
failed bidding, the committee has 15 days to come up with
an alternative or "more drastic" plan.

One possible alternative, he said, is a negotiated sale.
But if all else fails, Mr. Alcantara said the committee
might go for an "orderly liquidation."

"At least two things are constant. We will ensure that
whatever is the final mode, the mill will continue to
operate. Even with an orderly liquidation, we will consider
the interest and claims even of unsecured creditors and
trade creditors," Mr. Alcantara said earlier.

Bidding committee chairman East-West Bank Corp. vice-
chairman Gerardo Anonas could not be reached for comment.
The management committee is scheduled to meet today on this
development.  Meanwhile, a BusinessWorld source from one of
the creditor banks said unsecured lenders might submit an
alternative rehabilitation plan for Victorias.

Secured creditors, meanwhile, might opt for liquidation,
the source added.  The source said the alternative
rehabilitation plan may be a combination of a debt-to-
equity conversion, loan restructuring and haircut on some
of the claims.

"Clean creditors may propose that a portion of their
exposure be converted into equity. If the entire exposure
is restructured, Victorias will not be able to service the
payments. The company's cash flow cannot sustain the
payment," the source said.  "It (Victorias) needs a drastic
reduction in (loan) exposure...There may be some haircut on
the claims," the source added.

The source stressed, however, that the alternative
rehabilitation plan has yet to be approved by the banks'
board.  Banks were hoping that yesterday's bidding would be
successful, the source said.  Victorias ran to the SEC for
suspension of payments on July 4, 1997.

The firm said although it has "sufficient assets to cover
its liabilities," it "foresees the impossibility of meeting
debt payments as they fall due...because of losses due to a
large drop in sugar prices since October 1996 up to the
present and the restriction on the sale of refined sugar
classified as 'C' reserve" for domestic consumption.

Victorias' troubles began in 1995 from what it claimed were
increased foreign and local competition and inconsistent
government policies.  Mr. Alcantara said earlier the
management committee might experience difficulty in
attracting prospective investors.

"The tragedy is one and a half years ago, when the mancom
wanted to bid out (Victorias), the psychology for the
bidding was good. Now, the situation is different and
interest has accumulated. It's all unnecessary delay that
doesn't benefit anybody," he said. (Business World  21-


IRIDIUM: Curtains come down on Iridium service today
Singapore Telecom will close all accounts of Iridium - the
bankrupt satellite phone service - on March 31.

SingTel said it would waive the Iridium subscription fees
for the entire month of March. Any outstanding balance will
be refunded to the customers. The Iridium service will
cease to be available after 12.59 pm today Singapore time
as Iridium LLC has been unable to find a qualified buyer to
continue its operations.

SingTel started providing the Iridium service last year to
customers who require telecommunications coverage in the
most remote areas of the globe like the South Pole. These
customers include businessmen and executives working in
inaccessible regions of Indonesia and Papua New Guinea.
SingTel yesterday said it had taken steps to ensure that
the 60-odd customers using the Iridium service are not
unduly affected. It had sent out letters to all Iridium
subscribers notifying them of the possible cessation of the

"Upon confirmation of the cessation, we faxed another
letter to inform them of the news."

SingTel said alternative satellite communications solutions
are available to Iridium users. These include MPLUS, which
covers 95 per cent of the world's land mass. This system
uses Inmarsat satellites. Activation of the MPLUS service,
it added, can be done within one hour. (Singapore Business
Times  18-March-2000)


BANGKOK MASS TRANSIT SYSTEM: Share offering to pay debt
The sky train operator, Bangkok Mass Transit System Plc,
has filed a proposal with the Securities and Exchange
Commission on February 28 to float 400 million shares in an
initial public offering, said a company source.

Eighty per cent of the proceeds will be used to repay loans
and the rest will be used as working capital, the source
said.  Earlier, the company, which is capitalised at Bt14
billion, had planned to sell only 200 million shares to the
public at Bt24 to Bt26 each.

The company has not previewed its offering price, but
market observers believe that the shares should be sold at
between Bt18 and Bt20 each, depending on the number of
riders. At Bt20 per share, the offering would raise Bt8
billion. If the company receives approval to sell shares
this year, the initial public offering (IPO) could be the
biggest this year and would follow a twoyear absence of

The company abandoned its preopening projection of 600,000
riders a day and recently drew up three revenue scenarios
based on 200,000, 300,000 and 400,000 daily riders. The
scenarios also assume system capacity of 60,000 passengers
per hour in each direction, 18 operating hours a day, an
average fare of Bt25, and an exchange rate of Bt37.5 to the
US dollar.

Under the first scenario of 200,000 riders a day, which
closely matches present levels, the company projects a net
loss of Bt4.1 billion this year. According to this
scenario, its net income in 2029, when its concession ends,
will be Bt10.58 billion, compared to the Bt52.9 billion
previously projected.

According to the second scenario, the company will have a
net loss of Bt3.77 billion this year and a net income of
Bt15.86 billion in 2029. According to the third scenario,
the company's net loss will be Bt2.64 billion this year and
its net income will be Bt19.47 billion in 2029.

If the average number of riders surpasses 300,000 a day
this year, the company's projected income after 2012, when
it starts repaying loan principal worth Bt32.02 billion,
will gradually rise, as it will have to pay less interest.
However, if the number of riders stays at 200,000 a day,
the company will continue to suffer losses until 2021.
(The Nation  21-March-2000)

iTV PLC: Nation likely to announce iTV pullout
Nation Multimedia plans to announce a withdrawal of staff
and programmes from iTV Plc tomorrow, sources said.
Nation executives yesterday made the decision to withdraw
from the independent TV operator following months of debate
over iTV's financial plans.

The Nation would shift its news resources and programming
in a deal with cable operator United Broadcasting Corp.
No decision has been announced on whether the Nation's
pullout would include selling off its 10% stake in iTV.

A battle between Nation and Siam Commercial Bank has been
building for months over how to restructure iTV's four-
billion-baht debt.  Siam Commercial Bank, a major creditor
and also shareholder, wants iTV to writedown capital to
offset losses before raising new capital and restructuring
its loans.

The Nation has pushed for the bank to accept losses on its
loans, after which iTV would raise new funds in a public
offering.  It has also opposed a proposal for the bank to
swop some of its debt for shares, saying this would violate
iTV's principle of independence.

A restructuring plan proposed by iTV for a writedown of 1.6
billion baht and a debt-to-equity swop of one billion was
vetoed by the bank last month.  iTV has requested several
delays in paying concession fees to the government. The
company has an 800-million-baht payment due in May.
(Bangkok Post  21-March-2000)

NAKORNTHAI STRIP MILL: Restructuring ahead
NTS STEEL GROUP: Restructuring ahead
SRIRACHA HARBOUR: Restructuring ahead
SUN TECH GROUP: Restructuring ahead
After sweating three years of prolonged negotiations with
creditors over the massive loans of his group of companies,
Sawasdi Horrungruang, the second largest debtor in the
country, can break into a sweet smile now that debts worth
more than Bt80 billion will soon be restructured.

On March 30, creditors of Nakornthai Strip Mill Plc (Bt38
billion), N.T.S. Steel Group Plc (Bt18 billion), Sriracha
Harbour Plc (Bt4 billionBt5 billion) and Sun Tech Group Plc
(Bt4 billion) will cast their votes on the proposed
restructuring plans covering almost all of the debts.

The only exception will be Steel Top, a company in the NTS
group, which has not yet completed negotiations with its

According to Sawasdi, the merger of his company, NTS, with
Siam Steel and Bangkok Industry Steel of Somsak
Leesawadtrakul, the soninlaw of Bangkok Bank president
Chatri Sophonpanich, will likely be completed in the next
three months.  Although his corporate debt burden was
second only to Prachai Leopairatana's Bt120 billion at Thai
Petrochemical Industry, Sawasdi said last week he has
nothing to worry about only the Bt20 billion in personal
loans still to be restructured.

"I believe that in the next six months, Steel Top's debts
will be finalised. Only then can I start a new life,"
Sawasdi said.

However, the restructuring plan, with its debt reduction,
rescheduling of payments and debttoequity conversion
features, will leave Sawasdi with only 2 to 3 per cent of
NTS and Nakornthai Strip Mill, and 10 to 20 per cent of Sun
Tech. Sawasdi will be able to retain at least a 50 per cent
majority stake in Sriracha and hold on to Hemaraj Land and
Development Plc, his only company that did not have to
undergo debt restructuring.

Sawasdi, finishing his term as Senator today, became famous
for his motto of "no run, no default, but no pay", which he
uttered shortly after the baht depreciated in 1997 and
plunged his empire under a mountain of debt. It seemed to
represent the belligerent attitude of local families that
had taken generations to build up their business empires,
only to have them threatened by a de facto takeover by

Now he has changed his tune to "no run, no sue, and will
pay." But payment will come only after the restructuring
process.  It seems that Sawasdi accepts that the loss of
his majority ownership in his family businesses was a
necessary condition to allow them to survive and prosper,
and holds on to the consolation that he might be able to
return sometime in the future.

And he believes that in the next 10 years he can accumulate
up to about 30 per cent of the total shares. Some
restructuring agreements allow existing shareholders to buy
back creditors' holdings at a specified price and within a
certain timeframe.

Referring to the tripartite merger, Sawasdi said the owners
have already sketched their postmerger management roles and
determined the strengths of each organisation's workforce.
After the merger, the shares of each company may be swapped
for shares in NTS or Bangkok Industry Steel, which may be
selected to absorb shares transferred from the other two
companies, Sawasdi said.

Sawasdi expects that eventually, Siam Steel, a member of
Siam Cement Group, should hold a higher stake in the merged
entity than the shareholders of Bangkok Industry Steel or
NTS since it has the best financial condition. In any case,
the majority shareholders of both Bangkok Industry Steel
and NTS will be the creditor banks after debts have been
converted into equity.

Meanwhile, McDonald, the merger consultant, will receive a
stake in the steel company after the merger as part of its
compensation, Sawasdi said. (The Nation  21-March-2000)

THAI CAPITAL FINANCE: Gov't orders its closure
The Finance Ministry said it has ordered the closure of
financially ailing Thai Capital Finance Co Ltd, effective
today, and placed it in receivership due to its failure to
review and increase its capital within the timeframe set by
the authority.

The company's operating licence was withdrawn yesterday,
said Sathit Limpongpunt, the ministry's spokesman. The
firm's depositors and guaranteed creditors who wish to
withdraw funds must submit their claims at its headquarters
by June 19.

The order indicated that negotiations with Robo Bank of the
Netherlands for a Bt2billion takeover have failed.  The
firm was one of three finance companies that had signed a
memorandum of understanding with the Bank of Thailand in
early 1998 to solve their financial problems. The others
were SG Asia Finance and Securities, which is being
recapitalised after the Financial Sector Restructuring
Advisory Committee permitted the government to increase its
tierone capital, and Ocean Finance Co Ltd, which has been
defunct since late last year.

Bank of Thailand executive team leader Saksit Stittpaporn
said his team assumed control of the firm after the
ministry ordered its closing yesterday morning.

The Financial Institutions Development Fund (FIDF) would
pay the principal of the firm's depositors in full, he
said. Interest rates would be paid in line with the
contracts but would not exceed the average threemonth
fixeddeposit rate offered by the country's five largest
banks as of March 20, plus 6 per cent.

The firm has deposits of about Bt1.4 billion from more than
300 depositors, with about Bt400 million in paidup capital.
"There have been no deposit runs following Thai Capital
Finance's shutdown because people are confident that the
government will insure their money. As a result, only about
10 depositors have contacted the firm," Saksit said.

The firm's guaranteed creditors will be repaid the
principal in full and interest rates will adhere to the
contracts, but at an averaged minimum lending rate set by
the country's five largest banks as of March 20, minus 4
per cent.

Creditors not covered by the official guarantee, including
trade creditors, will be repaid from proceeds after all
company assets are liquidated.

Earlier, the central bank had filed criminal charges
against four executives of Thai Capital Finance, alleging
that they had falsified documents to show the company was
unable to pay depositors.

Consequently, the FIDF had to lend the firm Bt213.89
million. As of January, Thai Capital Finance's deposits
totalled Bt1.9 billion and its combined lendings were Bt1.5
billion. The company recorded an accumulated loss of Bt747
million and its capital base stayed negative at minusBt358
million. Its total assets were Bt1.55 billion.  (AFX News
Limited  20-March-2000, The Nation  21-March-2000)

Wongpaitoon Footwear Group Plc (WFC), a leading sub-
contractor for Reebok sports shoes, plans to submit a debt-
restructuring plan to the Corpo rate Debt Restructuring
Advisory Com mittee (CDRAC) later this month.

The company plans to complete the restructuring of its
entire debt by 2009, the plan said.  A source close to the
plan said the company on Friday worked out the final terms
with its five creditor banks, led by Siam Commercial Bank.

"I think that they (major creditors) will agree with the
plan," he said.

The source said all lenders agreed to a securitisation
worth Bt570 million in asset-back securities to boost WFC's
liquidity.  In addition, the creditors would pro vide a
syndicated loan to WFC to buy back a previous
securitisation organ ised by Daiwa Securities.

Under the plan, the company hopes to have restructured its
Bt3.7 billion debt by 2009. As part of the reorganisation,
the company has appointed Colin Browne as its senior vice-
president for production.  Other top administration
positions have also been filled by foreigners. The
Wongpaitoon family, the company's major shareholder, has
agreed not to get involved with the new management's

"I expect that the plan will be approved by CDRAC to allow
the company to con tinue operations," the source said.

Churchill Pryce Capital (Asia) Ltd is the company's
financial adviser working on the debt-restructuring plan.
WFC's monthly revenue is about Bt200 million at present.
Meanwhile, WFC and Bangkok Rubber Plc, another of Reebok's
local subcontractors, have jointly opened its "Product
Engineering Centre" in Bangkok to support operations.

WFC has invested Bt40 million in the centre and the two
companies will equal ly share operating expenses.  The
centre will be responsible for analysing all production
processes and sourcing raw materials for Reebok's new
designs prior to production.  The centre is operated under
the name RBK Thailand Inc with an annual bud get of US$1.5-
US$2 million (Bt57-Bt76 million).

Thailand is among the three largest sub-contractors for
Reebok in the region, the other two being China and Indone
sia.  The annual export volume in Thai land totals 12
million pairs of shoes. Production in Thailand accounted
for 20 per cent of Reebok's total yearly out put of 60
million pairs, worth a total of $2.4 billion.

Production in Thailand was expected to grow by 4-6 per
cent, on par with the expected growth in the Asian region.
David C Mishler, managing director of RBK Thailand, said
Reebok production in Asia accounts for 90 per cent of its
worldwide total. In Asia, China, Indonesia and Thailand
share a45:35:20 per cent production ratio.

Hugh Hamill, Hong Kong-based vice president for
manufacturing for Reebok International, said the company
has a long-term commitment with its Asian manufacturers due
to good supporting industries, high-skilled labour and
competitive costs. (The Nation  21-March-2000)

S U B S C R I P T I O N  I N F O R M A T I O N

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Copyright 2000.  All rights reserved.  ISSN: 1520-9482.

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