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     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

             Thursday, June 1, 2000, Vol. 3, No. 106

                                    Headlines


* A U S T R A L I A *

BHP CO LTD.: Sells U.S. steel assets for $135M loss
DATAFLOW COMPUTER SERVICES: Seeks receiver
JD EDWARDS: To cut 800 staff in restructure
MITSUBISHI AUSTRALIA: Fears policy change to hit sales
WESTONS: Fined for second price-fixing attempt


* C H I N A  &  H O N G  K O N G *

HOP WING FUNG PRINTING CO.LTD: Facing winding up petition
IBS NETWORK SYSTEMS LTD: Facing winding up petition
INTERBUILD CONSTRUCTION CO.: Facing winding up petition
NATION WIN LTD: Facing winding up petition
NEW WISE INVESTMENTS LTD: Facing winding up petition
PRESTON LTD: Facing winding up petition
SHING FAI UTENSIL ENGINEERING: Facing winding up petition
TRIJOY INVESTMENTS LTD: Facing winding up petition
WISE FARE INVESTMENT LTD: Facing winding up petition


* I N D O N E S I A *

PT DOK PERKAPALAN KOJA BAHARI:Faces bankruptcy,denies debts
PT SIERAD PRODUCE: Partner files bankruptcy suit against


* J A P A N *

HAZAMA CORP.: Draws up rebuilding blueprint
HINO MOTORS: Posts second annual loss in a row
MITSUBISHI HEAVY INDUS.: Falls deeply into red ink
MITSUBISHI MOTORS: Weak truck sales push into red
NICHIBOSHIN LTD.: Seeks haven from creditors via new law
MYCAL CORP.: To shut down flagship store in Tokyo
SEGA ENTERPRISES LTD.: Posts loss, turns back to chairman
YAMAHA CORP.: Annual loss deepens


* K O R E A *

DAEWOO GROUP: KDI chief calls for liquidation measures
DAEWOO MOTORS: Creditors mull W310B normalization funding DAEWOO MOTORS:
Creditors agree to fresh funds
HYUNDAI ENGIN.& CONSTR.CO.: Seoul urges drastic reform
HYUNDAI GROUP: Affiliates' overdrafts extended
HYUNDAI GROUP: Misses deadline for self-rescue plans
HYUNDAI GROUP: Reaches deal with Korea Exchange Bank
KWANGJU BANK: NPLs sale, then cash infusion ahead
SAEHAN INDUSTRIES: Creditors reject workout


* M A L A Y S I A *

L&M CORP (M) BHD: Served with restraining order
L&M GEOTECHNIC SDN: Served with restraining order
PANGLOBAL BHD.: 'No takeover of PanGlobal'
PANGLOBAL BHD.: Directors sue 'various parties'


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

PHILIPPINE NAT.BANK: Tan, Gov't draw sale fallback option
PHILIPPINE NAT.BANK: Audit reveals extent of bad loans
PHILIPPINE NAT.BANK: Lewis,Templeton join forces to bid
PILIPINO TELEPHONE: Losses far from over
URBAN BANK: Bank of Commerce pact `no problem to bidding'
URBAN BANK: Shareholders clear sale to Commerce
URBAN BANK: Officials violated DOSRI rules - BSP


* T H A I L A N D *

iTV: Directors approve 40% stake for Shin Corp
iTV: Clarification to SET on debt restructuring
PROPERTY PERFECT PLC: BOA files for its bankruptcy
SIKARIN PLC: SET suspends trading, faces delisting
THAI DURABLE TEXTILE PLC: Strike threatened
THAI TEL.& TEL.: Debt plan passes


=================
A U S T R A L I A
=================

BHP CO LTD.: Sells U.S. steel assets for $135M loss
---------------------------------------------------
Diversified miner BHP Co Ltd has sold its US West Coast
assets for $US234 million and booked a loss of $135 million
on the deal with Mexico's Grupo IMSA SA.

BHP said however, the time was right to exit the
businesses.  Rising prices of input used by the West Coast
assets had squeezed margins and margins in the business had
fallen on average about three per cent each year since the
mid-1980s. The rising interest rate environment, which was
slowing economic activity, also influenced the move. The
disposal is part of BHP's plan to reposition as a natural
resources firm with a regional steel focus. (Asia Pulse
29-May-2000)

DATAFLOW COMPUTER SERVICES: Seeks receiver
------------------------------------------
After a year of significant setbacks, software and
peripherals distributor Dataflow Computer Services has
placed itself in the hands of a receiver.

In a statement, the company said its bankers had appointed
Martin Madden of Arthur Andersen as receiver yesterday
afternoon. Dataflow said it had requested the appointment.
Founder Jeffrey Tobias said the news followed six months of
hardship for the retail and education distributor.

"What has happened to this independent, Australian-owned
company which I built from scratch to sales over $89
million in 1999 distresses me deeply," he said.

Dataflow's woes began last year when the company lost its
Microsoft distributorship, reported to make up close to 60
per cent of the company's revenues.  Customer service began
to suffer in October, with delays in the implementation of
a new ERP system. Customers also became nervous when
Dataflow moved offices and a number of new investors took
stakes in the company.

"The final blow was the surprise departure of an
entertainment supplier (Activision) in April, leaving
Dataflow with inventory totalling almost $3 million with
little or no opportunity to realise the full value of this
stock," the company said.  Dataflow would continue to trade
under receivership.  (Australian It  30-May-2000)

JD EDWARDS: To cut 800 staff in restructure
-------------------------------------------
ERP vendor JD Edwards will retrench nearly 800 staff in a
worldwide restructure, despite posting better than expected
second-quarter financial results.

After warning of huge losses for the quarter, JD Edwards
posted a net loss of $US2.3 million ($4 million), excluding
acquisition-related charges. It posted a $US10.4 million
loss for the same period last year.  Australian officials
said local losses would be minimal, with up to eight
people, or 2 per cent of its workforce, likely to be
retrenched.

JDE Australia and New Zealand director Glenn Wright said
the local layoffs would affect staff in accounting and
internal support roles.

"It's the first time the company has ever had to do this,"
Mr Wright said.  "It will make the company more agile and
nimble in preparation for the new collaborative commerce
applications launched in mid-June."

The company also planned to make savings by implementing
its e-procurement solutions, using computer-based training
more widely to provide alternatives for customers and
reducing office space and related overhead expenses.
(Australian It  30-May-2000)

MITSUBISHI AUSTRALIA: Fears policy change to hit sales
------------------------------------------------------
Tens of thousands of public servants can now swap their
Australian-made cars for imports, through salary packaging
deals.  The Federal Government has quietly abolished a rule
that makes locally-built vehicles mandatory under the
packages, which action was met yesterday with dismay by
Mitsubishi, whose government sales of about 65,000 cars a
year could be severely hit.

At present, public servants who elect to sacrifice part of
their salaries in return for discount car leases can choose
only from an all-Australian range.  But under the new
directive they can choose anything, from a cheap Asian
import to a luxury high-performance vehicle.

All are available through accredited government suppliers
at special rates, and with the tax advantages associated
with salary packaging deals.  A spokesman for Mitsubishi
said the company, which had already cut jobs this year, was
"surprised and dismayed" by the decision.

"The Federal Government has said that it's committed to a
healthy Australian manufacturing industry. Our view would
be that that commitment should flow through into the cars
they make available," he said.

It is understood salary packaging is now available to a
sizeable proportion of Australia's 100,000-strong public
service, although no central figures are kept as
sacrificing does not have to be declared.

"Increasingly, the Government is moving towards such
packaging . . . there is a growing number of packages which
put public servants in the `user-chooser' category," the
Mitsubishi spokesman said.

The decision was made by David Kemp, the federal minister
with responsibility for the public service, in conjunction
with Industry Minister Nick Minchin.  It was not announced
publicly by the Government but logged on the Workplace
Relation Department's website. The decision comes only
weeks after a decision to relax the Australian-made
requirement for high-ranking public servants who are
provided with cars directly by their departments.

A spokeswoman for Dr Kemp said it was "inappropriate" for
the Government to dictate to public servants who were using
their own salaries to lease cars.  But Opposition industry
spokesman Bob McMullan said it was the Government's
responsibility to support local industry.

The Department of Workplace Relations confirmed it had
about 70 employees on package deals, from a workforce of
about 1700.  But other agencies in the 189,000-strong
Commonwealth public services offer packaging to a greater
proportion of their employees. (The Advertiser  30-May-
2000)

WESTONS: Fined for second price-fixing attempt
----------------------------------------------
The biscuit manufacturer Westons has been fined $900,000 in
the Federal Court for an attempt at price-fixing in
Tasmania.

In a case brought by the Australian Competition and
Consumer Commission, Westons was fined for trying to induce
retailers to lift the price of its "Lots O' Cookies"
product in 1997.  The court said that following a small-
scale price war between Chickenfeed and Woolworths, trading
as Purity and Roelf Vos, Westons formulated a plan to
induce the retailers to raise the price of the cookies.

Justice Goldberg said there was a deliberate and conscious
attempt to eliminate competition in the relevant market.
It is not the first time George Weston has been fined over
price- fixing.  In 1997, only days before this offence, the
company was fined $1.25 million for another incident in
Victoria.  (ABC News Online  30-May-2000)


==============================
C H I N A  &  H O N G  K O N G
==============================

HOP WING FUNG PRINTING CO.LTD: Facing winding up petition
---------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for July 5 on the petition of Chan
Man Chiu for the winding up of Hop Wing Fung Printing
Company Limited. A notice of legal appearance must be filed
on or before July 4.

IBS NETWORK SYSTEMS LTD: Facing winding up petition
---------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 14 on the petition of
Cisco System Inc. for the winding up of IBS Network Systems
Limited. A notice of legal appearance must be filed on or
before June 13.

INTERBUILD CONSTRUCTION CO.: Facing winding up petition
-------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 7 on the petition of
Eastime Engineering Limited for the winding up of
Interbuild Construction Company Limited. A notice of legal
appearance must be filed on or before June 6.

NATION WIN LTD: Facing winding up petition
------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for July 12 on the petition of Lau
Yuk Ha for the winding up of Nation Win Limited. A notice
of legal appearance must be filed on or before July 11.

NEW WISE INVESTMENTS LTD: Facing winding up petition
----------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 28 on the petition of HE
Development Limited for the winding up of New Wise
Investments Limited. A notice of legal appearance must be
filed on or before June 27.

PRESTON LTD: Facing winding up petition
---------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for July 12 on the petition of Law
Wia Keung for the winding up of Preston Limited. A notice
of legal appearance must be filed on or before July 11.

SHING FAI UTENSIL ENGINEERING: Facing winding up petition
---------------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 7 on the petition of Wong
Ho Wing for the winding up of Shing Fai Utensil Engineering
(HK) Limited. A notice of legal appearance must be filed on
or before June 6.

TRIJOY INVESTMENTS LTD: Facing winding up petition
--------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 7 on the petition of Hand
Chi Lun for the winding up of Trijoy Investments Limited. A
notice of legal appearance must be filed on or before June
6.

WISE FARE INVESTMENT LTD: Facing winding up petition
----------------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for June 28 on the petition of The
Chinese State Bank Limited for the winding up of Wise Fare
Investment Limited. A notice of legal appearance must be
filed on or before June 27.


=================
I N D O N E S I A
=================

PT DOK PERKAPALAN KOJA BAHARI:Faces bankruptcy,denies debts
-----------------------------------------------------------
State-owned shipbuilder PT Dok Perkapalan Koja Bahari,
petitioned for bankruptcy by ING Bank, Hong Kong Chinese
Bank and Cho Hung Bank, said it does not recognize matured
debts worth 11.2 mln usd as claimed by the creditors.

Dok Perkapalan's lawyer Rahmat Effendi said after a
commercial court hearing that his client "will not pay a
penny" to them.  ING Bank, Hong Kong Chinese Bank and Cho
Hung said they have matured debts worth 5.4 mln usd plus 9
bln rupiah, 3.5 mln usd and 2.3 mln usd respectively,
according to the petition filed by the three banks. They
said the debts originated from promissory notes issued by
the company in 1996, which matured in 1997.

"Because the promissory notes were signed by former
managing director Akmal Wahid and a former director Muklis
Amin, both in a personal capacity, the company didn't
recognise the debts," he said.

Rahmat Bastian, lawyer for the three creditors, said his
clients have adequate evidence, including the transfer of
proceeds of the promissory notes to the company's account,
instead of personal accounts of the two directors.  (AFX
News Limited  30-May-2000)

PT SIERAD PRODUCE: Partner files bankruptcy suit against
--------------------------------------------------------
PT Hagajaya Kemasindo has filed a bankruptcy suit against
its partner and Anwar Sierad unit, PT Sierad Produce, for
failing to repay matured debt worth 408 mln rupiah,
Hagajaya lawyer W. Hadi Sukrisno said in a document.

The first hearing is scheduled on May 31.  The company's
parent Anwar Sierad is also facing a number of bankruptcy
suits by its creditors including that filed by the
Elevation Group.  (AFX News Limited  29-May-2000)


=========
J A P A N
=========

HAZAMA CORP.: Draws up rebuilding blueprint
-------------------------------------------
Hazama Corp., one of Japan's major construction companies,
is undergoing a tough reality check as it tries to save its
business.

The Tokyo-based company helped build the world's tallest
building - the Petronas twin towers in Kuala Lumpur. Last
week, it disclosed a net loss of 25.5 billion yen for
fiscal 1999, compared with a net profit of 1.5 billion yen
the year before.  Hazama has asked its banks to forgive
about 105 billion yen in debt, roughly one-quarter of its
consolidated interest-bearing liabilities.

The company unveiled a plan to halve its debt over five
years. It promised other measures, such as disposing of
properties that are losing value, assuming the banks accept
the bailout plea. The contractor also said it will cut
executive salaries and reduce its payroll.

Dai-Ichi Kangyo Bank is likely to go along with the
request. "We will examine the plan positively," the bank's
president, Katsuyuki Sugita, said.

Other creditors include Mitsubishi Trust & Banking Corp.
and two banks -Long-Term Credit Bank of Japan and Nippon
Credit Bank - that themselves went bust.  Negotiations with
the banks can be grueling. The outcome is likely to depend
on the attitudes of second-tier main creditors. The key is
whether Hazama is able to devise a comprehensive and
realistic restructuring package, industry watchers said.

Hazama reported that its fiscal 1999 net loss reflects 46
billion yen in extraordinary charges, including 9.8 billion
yen in latent losses on real estate whose market value fell
more than 50% since purchase.

The Japanese Institute of Certified Public Accountants has
said it will require immediate devaluation of real estate
held for resale before March 31, 2001, if its market value
has dropped 50% or more since its purchase.  Hazama also
saw 22.5 billion yen in losses on loans extended to the
subsidiary of a golf-course operator and costs associated
with guaranteeing the unit's debt.

The company also booked 5.6 billion yen against its loan-
loss reserves after its investment in a U.S. real-estate
subsidiary went sour.  In the current year through next
March, Hazama plans to write off the 8.1 billion yen in
losses remaining as of the end of fiscal 1999 by tapping
into reserves and reducing capital.

Hazama appears to have posted an extraordinary loss
exceeding 20 billion yen for the last fiscal year after
booking the appraisal loss.  Hazama officials acknowledged
their call for help stemmed in part from the tightening in
accounting rules regarding depreciated assets.

"My responsibility is to get our company's reconstruction
program on the right track," Hazama President Fumiya Yamato
told the press.

Yamato's remark was interpreted to mean that he will be
able to keep his job. Other presidents of debt-ridden
contractors have resigned their posts.  (Nikkei  29-May-
2000)

HINO MOTORS: Posts second annual loss in a row
----------------------------------------------
Hino Motors, Japan's largest truckmaker and an affiliate of
Toyota Motor, reported its second consecutive annual group
loss on weak domestic demand. For the year to March 31,
Hino posted a group net loss of 21.8B yen or a loss of 59.7
yen a share. That follows a net loss of 36.7B yen, or 101.2
yen a share, a year earlier.

MITSUBISHI HEAVY INDUS.: Falls deeply into red ink
--------------------------------------------------
Mitsubishi Heavy Industries Ltd. posted 137 billion yen in
consolidated net losses in the year ended March 31,
compared with 18.1 billion yen in profit a year earlier,
the company said. Group sales fell 1% to 2.87 trillion yen.

This is the first group net loss since the company was
formed in 1964 by the reunion of firms created through the
breakup of the original Mitsubishi Heavy Industries during
the postwar Occupation.  The leading heavy-machinery maker
attributed the heavy loss mainly to unprofitable plant
construction work overseas.

The company won overseas plant-construction projects in
low-ball bidding amid intense competition from foreign
rivals. The low bids badly damaged the profitability of the
projects.

Mitsubishi Heavy also covered 130.8 billion yen of a total
shortfall of 285 billion yen in reserves for retirement pay
and pension obligations. The company posted an
extraordinary loss to cover the expected loss from ongoing
projects and the write-off of inventories. As a result, the
group posted a total extraordinary loss of 248.9 billion
yen.  Mitsubishi Heavy forecasts 90 billion yen in group
operating profit in the current business year through
March. All operations, excluding the shipbuilding division,
are expected to see a profit.

The company aims to break even in its group net balance by
reducing payroll and other restructuring measures.  The
company said it will cut its annual dividend to 2.5 yen
from 10 yen last year.  (Nikkei  29-May-2000)

MITSUBISHI MOTORS: Weak truck sales push into red
-------------------------------------------------
Mitsubishi Motors Corp. (7211) reported Thursday a
consolidated net loss of 23.3 billion yen in the year ended
March 31, compared with a net profit of 5.7 billion yen a
year earlier. The company attributed the poor performance
largely to weak domestic truck sales.

Consolidated sales fell 5% to 3.33 trillion yen, after auto
sales dipped 5% to 1.49 million vehicles due largely to the
anemic domestic market.  Group operating profit was well
below projections at 22.5 billion yen, less than half the
targeted 50 billion yen.

The economic recovery pushed up operating profit in Asia to
3.8 billion yen, compared with a loss of 3.7 billion yen
last year. But European operations fell into the red with
an operating loss of 1.8 billion yen, compared with a
profit of 3.4 billion yen in fiscal 1998. Operations in the
rest of the world also recorded a loss of 4.9 billion yen,
against profit of 4.5 billion yen a year earlier.

The company posted a group non-operating loss of 19 billion
yen, due to the yen's appreciation. Pretax loss stood at
3.8 billion yen, marking the third straight year of losses.
For the current term through next March, the automaker
targets group sales up 6% to 3.55 trillion yen and group
operating profit more than doubling to 50 billion yen.

Pretax profit is forecast at 20 billion yen, the first
profit in four years, partly because it will reduce
interest payments by slashing debt with capital pumped in
by DaimlerChrysler AG.  Mitsubishi intends to write off the
whole of its 133.7 billion yen in underfunded retirement
allowances in fiscal 2000, resulting in a projected net
loss of 70 billion yen. The company expects to pay no
dividend for the third consecutive year.  (Nikkei  25-May-
2000)

MYCAL CORP.: To shut down flagship store in Tokyo
-------------------------------------------------
The Mycal Corp. (8269) group plans to shut down and sell
off its flagship clothing department store in Tokyo's
Shibuya district in late October, The Nihon Keizai Shimbun
learned Saturday.

The Mycal group hopes to sell the land and building for 10-
12.5 billion yen. This is part of measures to reduce
interest-bearing liabilities to 700 billion yen by the end
of fiscal 2003 from 1.07 trillion yen at the end of fiscal
1999.  The seven-story department store has total floor
space of about 2,500 sq. meters. The store has 24 tenants,
including retailers of men's and women's clothing and
sundry goods, restaurants and a sports club.

Sales at the department store, established in 1984, peaked
at 3 billion yen in fiscal 1991, reflecting the popularity
of designer goods. Sales have declined sharply since,
reaching only 1.95 billion yen in fiscal 1999.  The Mycal
group is considering shutting down some 10 other stores
over the next two years. (Nikkei  27-May-2000)

NICHIBOSHIN LTD.: Seeks haven from creditors via new law
--------------------------------------------------------
The number of companies which applied for court protection
from creditors under the corporate reconstruction law stood
at 100 as of Monday, shows a report released the same day
by Teikoku Databank Ltd. Teikoku Databank expects the
number to continue increasing.

Of the 100, Nichiboshin Ltd. (8582), a nonbank financial
institution, is suffering the heaviest debt -- 289.9
billion yen. The law, which took effect in April, allows
ailing companies to file for protection in court before
actually going insolvent.

The private research company said the largest group of
applications, 38, were made by manufacturers, followed by
16 from construction companies and 15 each from wholesalers
and services companies. Golf-course operators were also
included.

The new law makes it easier for troubled companies to apply
for legal protection compared with the composition law, and
eases the requirements for creditors to approve a firm's
restructuring plans.  The law also includes a rule banning
creditors from executing their full security rights to
seize collateral which is considered necessary for a debtor
to continue operations.

However, those seeking protection under the law are
required to gain approval from creditors for their
rehabilitation plans within six months of application.
If they fail to win approval by the deadline, they are
forced, in principle, to enter the bankruptcy process.
(Nikkei  30-May-2000)

SEGA ENTERPRISES LTD.: Posts loss, turns back to chairman
---------------------------------------------------------
Sega Enterprises Ltd. rocked by intensifying competition in
the video-game business, is turning the reins back to its
74-year-old chairman.

Sega's president, Shoichiro Irimajiri, 60, stepped down
from his post Friday after Sega announced its third yearly
loss in a row. The company has been hurt by disappointing
sales of its make-or-break product, the Dreamcast game
console, and related software. The company's chairman, Isao
Ohkawa, will take on the job of president, while Mr.
Irimajiri will stay on as vice chairman.

Sega's woes underscore the commanding lead that Sony Corp.,
maker of the PlayStation game console, is taking in the
global video-game market. Sega's sales rose 27% in the year
through March, but the increase was lackluster given the
introduction in the U.S. last September of Sega's new game
machine.

Sega, the world's No. 3 game-machine maker, posted a group
net loss of 42.88 billion yen ($399.3 million) for the year
to March 31. Sales rose to 339.06 billion yen from 266.19
billion yen.

Meanwhile, rival Nintendo Co., the world's No. 2 game maker
after Sony, posted a group net profit of 56.06 billion yen
for the year through March 31, down 35% from the year
before, on a 7.4% fall in sales, to 530.7 billion yen.

Sega's Mr. Irimajiri, formerly a senior executive at Honda
Motor Corp., said he will step down after two years running
Sega. Mr. Ohkawa is also chairman of computer-services
company CSK Corp., which holds 19% of Sega's shares.

"We aim to revive the company focusing on growing Internet-
related services by using Dreamcast," Mr. Ihkawa said. The
Dreamcast can be linked to the Internet for playing video
games and using electronic-mail services.

However, it isn't clear whether Mr. Okawa, who has long
been recognized as the real power at Sega, will be able to
shake up the company enough to put it in the black again.
Sega, which shipped 4.65 million of its Dreamcast consoles
world-wide in the year through March 31, faces enormous
pressure from its rivals. Sony, which is already selling
the PlayStation 2 in Japan, is rolling out its new machine
in October in the U.S. and Europe. (The Asian Wall Street
Journal  29-May-2000)

YAMAHA CORP.: Annual loss deepens
---------------------------------
Yamaha Corp. said its consolidated net loss for the year
ended March 31 deepened to 40.78 billion yen ($379.8
million), compared with the year-earlier loss of 15.88
billion yen. It cited one-time losses related to
retirement payments and restructuring.

The Japanese musical-instrument maker said its group sales
slipped 6.4% to 527.9 billion yen. The company said its
sales were hurt by weak domestic demand for musical
instruments and the yen's rapid advance.  Its electronics-
equipment sales tumbled as a result of the termination of
thin-film magnetic-heads production. The company pulled out
of the field because of stiff competition.

The company said it returned to profitability at the
operating and pretax levels, as strong performances by its
subsidiaries bolstered results. (Dow Jones, Asian Wall
Street Journal  30-May-2000)


=========
K O R E A
=========

DAEWOO GROUP: KDI chief calls for liquidation measures
------------------------------------------------------
Korea Development Institute President Lee Jin-soon said
Friday that some Daewoo affiliates and other insolvent
companies should be liquidated early to regain confidence
in the market.

"Potential insolvency in the financial sector should be
eliminated as soon as possible to recover confidence," Lee
said, calling for the early disclosure of potential
insolvencies at Cho Hung Bank, Hanvit Bank and some
companies in workout.

Speaking at an economic review meeting held by Finance and
Economy Vice Minister Uhm Rak-yong, he said: "The present
condition is not as dangerous as it was in 1997, but the
government should present a blueprint as soon as possible
to get rid of insolvent companies and financial
institutions."

He added that recent contractions in the financial market
had contributed to cooling down the overheating economy but
that excessive instability could have bad repercussions for
the economy.  Hyundai Economic Research Institute President
Kim Joong-woong said the government's inconsistent economic
policies on short-term interest rates and public funds were
one of the factors that had brought financial instability.

He also said restructuring could not be fully advanced if
the financial market was unstable and urged the government
to focus on stabilizing the financial sector with
consistent policies.  Commerce, Ministry and Energy Vice
Minister Oh Young-kyo said imports which had been surging
had started to fall and that the monthly trade surplus
would be around $US1 billion at the end of May.

Due to unknown variables like labour-management disputes,
oil prices and foreign exchange rates, the figure is still
uncertain. (Asia Pulse  26-May-2000)

DAEWOO MOTORS: Creditors mull W310B normalization funding
---------------------------------------------------------
The creditors of Daewoo Motor are due to convene Monday to
discuss the possibility of providing W310 billion to the
nation's second-largest automaker.

Lee Keun-young, president of major creditor Korea
Development Bank (KDB) said Sunday that Daewoo Motor
creditors have proposed a new loan package that would set
the firm smoothly on course for its upcoming auction,
saying that normalization of the firm would help to fetch a
higher price from the eventual buyer.  (Digital Chosun  28-
May-2000)

DAEWOO MOTORS: Creditors agree to fresh funds
---------------------------------------------
Daewoo Motor's creditors agreed to supply an additional 310
billion won (about HK$ 2.12 billion) to the debt-ridden
car-maker after a labour strike last month reduced
production and sales.

Korea Development Bank (KDB), Hanvit Bank, Cho Hung Bank
and other key creditors will give the money to Daewoo
Motor starting on June 1, KDB said.

"That's the minimum amount estimated to cover normal
operations," said Daewoo Motor spokesman Lee Chang -won.

The month-long strike reduced production by about 13,000
vehicles due for export and by 3,500 cars due for the
domestic market, equivalent to about 135 billion won
in lost sales, the company said. An analyst at Good Morning
Securities in Seoul said the loan was "essential to avoid
Daewoo Motor from going insolvent."   (South China Morning
Post  30-May-2000)

HYUNDAI ENGIN.& CONSTR.CO.: Seoul urges drastic reform
------------------------------------------------------
Following creditor banks' decision to provide emergency
loans to Hyundai Group's construction arm, the government
has urged the conglomerate to make more extensive
restructuring efforts and improve its management structure
in order to regain market confidence.

Terming a liquidity crunch at Hyundai Engineering &
Construction Co. as "a confidence crisis," the government
has also called on nonbank financial institutions to
refrain from collecting debts from the nation's largest
conglomerate to help maintain financial stability.

The request was made Saturday after a meeting of top
economic policymakers, including Minister of Finance and
Economy Lee Hun-jai, Financial Supervisory Commission
Chairman Lee Yong-keun, Fair Trade Commission Chairman Jun
Yun-churl and Senior Presidential Secretary for Economic
Affairs Lee Ki-ho.

In a news conference after the meeting, FSC Chairman Lee
said the current liquidity shortage at Hyundai Engineering
& Construction is temporary and that the whole group is not
in a financial trouble.

"Hyundai Engineering & Construction is suffering from a
temporary liquidity crunch but there is little chance of
its spreading to the entire group," Chairman Lee said.
"Despite the fact, the market sees Hyundai Engineering &
Construction's trouble as the problem of the group itself.
In that context, it can be called a "confidence crisis."

Hyundai's confidence crisis has occurred because its
restructuring efforts have been slower than expected by the
market and it has failed to build a responsible management
structure, the top financial regulator said.  He added the
conglomerate will soon take self-rescue measures such as
management improvement and stronger restructuring to regain
confidence from the market.

Participants at the meeting also shared the view that
nonbank financial institutions should refrain from
collecting Hyundai's debts competitively in order to keep
the domestic financial markets stable, he added.

Meanwhile, Korea Exchange Bank (KEB), or Hyundai's main
creditor bank, said Saturday that three other creditor
banks of Hyundai Engineering & Construction will each
provide 50 billion won to the company to help ease its
liquidity shortage.

However, Hanvit Bank, Cho Hung Bank and Housing and
Commercial Bank will later decide when they will provide
the loans, a KEB official said. The planned extension of
the loans came after KEB gave the troubled company 50
billion won in an emergency loan last Tuesday. KEB also
provided an emergency loan of 50 billion won to Hyundai
Merchant Marine Co. May 19.

In exchange for the emergency loans, Hyundai Engineering &
Construction, the nation's leading construction company,
will soon sell its holdings of securities worth 300 billion
won to 350 billion won, KEB said.  The financial status of
Hyundai Group affiliates is healthy and their business
performances are generally solid, the bank said, adding
that Hyundai Engineering is in a temporary liquidity crunch
as it faces difficulty in rolling over its bonds and
commercial paper.

KEB said 14 listed affiliates of Hyundai posted a combined
turnover of 23.9 trillion won and a net profit of 400
billion won in the first quarter of this year. Hyundai
Group's total borrowing dropped to 36.1 trillion won at the
end of April from 37.5 trillion won at the end of last
year. As of March this year, Hyundai Group's assets totaled
88.6 trillion won, the largest among local conglomerates,
according to the Fair Trade Commission. (The Korea Herald
29-May-2000)

HYUNDAI GROUP: Affiliates' overdrafts extended
----------------------------------------------
Two units of South Korea's giant Hyundai Group were on
Friday allowed to delay the payment of their overdrafts
by a month as the units face a temporary liquidity cruch,
its main creditor bank said Friday.

Hyundai Engineering and Contruction Co. and Hyundai
Merchant Marine Co. were given until the end of June to
repay overdrafts amounting to 50 billion won (44 million
dollars), the Korea Foreign Exchange Bank said.  "The two
units will use the money to keep their operations moving
on," a bank spokesman told AFP. (Agence France-Presse  26-
May-2000)

HYUNDAI GROUP: Misses deadline for self-rescue plans
----------------------------------------------------
The Hyundai Group missed a government-imposed Sunday
deadline for producing stronger self-rescue measures,
casting dark clouds over the shaky local financial market.

The government and creditor banks, while offering a 400
billion won ($352.4 million) rescue package for Hyundai,
set a deadline of May 28 for the group to present sweeping
restructuring measures, including a shift from family-
controlled management, and sales of noncore affiliates,
real estate holdings and securities.

But the nation's largest conglomerate failed to meet the
deadline, saying that many of the government's reform
demands are unrealistic. Furthermore, it argued that its
cash flow problems are only temporary and blamed the
current state on the structural problems of the domestic
bond market.

Underlining the defiant attitude towards reform pressures,
Hyundai Group Chairman Chung Mong-hun had suddenly left the
country Saturday evening for unknown reasons. Chung,
accompanied by Hyundai Engineering & Construction President
Kim Yoon-kyu, is reportedly staying in Japan and scheduled
to return home Tuesday, group officials said, explaining
that the chairman flew to Japan for talks on foreign
capital attraction that has long been pushed for.

"The Hyundai chairman is expected to contact Japanese
investors, in a bid to find a breakthrough to the group's
liquidity crisis," said an analyst, speculating that
Hyundai may come up with revised reform plans this week.

The creditors' demand for the dismissals of problematic
financial-unit executives, probably including Hyundai
Securities Chairman Lee Ik-chi and Hyundai Investment Trust
Securities President Lee Chang-shik, has also been
unheeded.

"Hyundai has already done sufficient reforms in terms of
debt reductions and downsizing, while Honorary Chairman
Chung Ju-yung has virtually stepped down from management
through his sell-offs of equities in nonauto units last
week," said a group spokesman, pinning the blame on the
structural problems of the domestic capital market.

Other group executives, however, hinted that Hyundai may be
forced to comply with the government's request for the
retirement of the honorary chairman. In this regard, the
elder Chung may sell off his 6.8 percent stake in Hyundai
Motor to other shareholders of the automaker, completely
severing all ties to the group's management, they forecast.
They also said that speeding up of spin-offs for steel and
heavy industries units and sales of some noncore units may
be included in the expected self-help measures.

Industry observers said the Hyundai Group had no
alternative but to push through radical reforms to recover
market confidence. "If Hyundai continues delaying reforms,
investor confidence will falter, share prices will fall
further and Hyundai will find it much more difficult to
raise the necessary cash," said a Seoul-based foreign
analyst.

Hyundai's credibility faltered in the wake of the recent
sibling fight for the control of group chairmanship and
concerns over a possible insolvency of the group's
investment trust unit heavily exposed to the bankrupt
Daewoo Group companies.

Contrary to the intensifying reform pressures, creditor
banks have repeatedly stressed that the Hyundai Group was
doing well, with a relatively low debt-equity ratio of 181
percent. The 14 listed Hyundai units posted a net profit of
400 billion won on turnover of 23.9 trillion won in the
first quarter of this year, they said.  (The Korea Herald
29-May-2000)

HYUNDAI GROUP: Reaches deal with Korea Exchange Bank
----------------------------------------------------
Korea Exchange Bank said it and the Hyundai Group have
reached a final agreement on detailed restructuring plans
put forward by Hyundai today.

The KEB said its president Kim Kyung-lim and Hyundai's
restructuring committee head Kim Jae-soo discussed specific
measures which KEB approved.  The details will be announced
by Hyundai tomorrow, it said.  A KEB spokesman said Hyundai
will first aim to sell 340 bln won worth of securities on
the market as pledged yesterday to secure liquidity.

"However, if market conditions are unfavorable, Hyundai
will seek to use the stock as collateral for the equivalent
amount of short-term loans."

Hyundai may also be able to trade the stocks in return for
liquidity support from creditors.  KEB president Kim Kyung-
lim said he has completed the final fine-tuning of the
proposals with Hyundai, adding that today's proposed
programme isspecific than earlier ones.  The KEB gave no
further details of the proposed restructuring.  (AFX-
Extel News Limited  30-May-2000)

KWANGJU BANK: NPLs sale, then cash infusion ahead
-------------------------------------------------
Kwangju Bank (KSE:05770) operations will be turned around
after the sale of 400 billion won (US$ 353 million) in non-
performing holdings and an infusion of $ 100 million in
foreign capital by the end of September.

The bank said Monday it has exchanged a memorandum of
understanding with Cerberus Capital of the United States
regarding the transactions.  Under the deal, the bank will
be able to secure around 400 billion won in funds through
the sale of bad holdings and its headquarters building,
reducing the rate of non-performing assets from 6.5 percent
to 1 percent.

The bank will also be able to attract $ 100 million in
foreign capital from the US capital investment firm, which
will be finalised pending approval by the Financial
Supervisory Commission (FSC) by the end of September.
When the deal is completed, the bank's BIS ratio will be
improved to the 12 percent level from 8.63 percent at the
end of last year, with net profits of 10 billion won this
year.  (Asia Pulse  29-May-2000)

SAEHAN INDUSTRIES: Creditors reject workout
-------------------------------------------
The creditors of the ailing Saehan group have made a
preliminary decision not to put the conglomerate's flagship
subsidiary, Saehan Industries, under a workout plan.

A workout for another unit, Saehan Media, was, however
green-lighted in a Saturday meeting of the group's
creditors, which include Hanvit Bank and Korea Development
Bank (KDB). Sources say that KDB, the largest creditor of
Saehan Industries, along with several other creditors of
the subsidiary, opposed workout measures for the firm as
they would ultimately have to increase their exposure to
the firm by providing additional funding for the workouts.
KDB's exposure to Saehan Industries accounts for 21.44% of
the company's total debt.

KDB stands, however, to lose relatively little if Saehan
Media is liquidated, as it holds sufficient collateral for
its loans to the company. Sources added that creditors
easily approved a workout plan of Saehan Media, as the
firm's debt is spread out among a number of different
lenders.

The creditors of Saehan Industries are due to meet again
this week to make a final decision on whether they will
approve workout steps for the firm. If the workout is not
approved, the firm will be placed under court control or
have to file for bankruptcy. (Digital Chosun  28-May-2000)


===============
M A L A Y S I A
===============

L&M CORP (M) BHD: Served with restraining order
L&M GEOTECHNIC SDN: Served with restraining order
-------------------------------------------------
L&M CORP (M) BHD (LMC) and its subsidiary L&M Geotechnic
Sdn Bhd have received a restraining and stay order from the
High Court under Section 176 (1) of the Companies Act 1965
yesterday.

LMC is in the midst of finalising the details of the
proposed restructuring scheme which include a proposed
share swap by the shareholders of LMC with Newco shares on
the basis of one Newco share for 10 LMC shares.  Newco
would then be the holding company of LMC.

LMC will propose rights issue of about 28.54 million shares
of RM1 in Newco issued at par, together with 28.54 million
free detachable warrants on the basis of 14 new Newco
shares with 14 warrants for every one Newco share held.
The proceeds from the proposed rights issue would be
utilised for part repayment of LMC creditors, working
capital and estimated expenses of the proposed scheme.
(The Star  30-May-2000)

PANGLOBAL BHD.: 'No takeover of PanGlobal'
------------------------------------------
PANGLOBAL Bhd reiterated that its restructuring plans are
going ahead as planned and dismissed talks that it may be
taken over.

Group chief executive officer Alex Wong said the frequent
news reports that the company might be taken over were
unfounded.

"Bank Negara Malaysia approval is needed for the takeover
of a finance company. Also it contravenes the Securities
Commission act for there is failure to disclose the true
intention of the parties to take control and to make a
mandatory general offer," he said.

He said that the company, which had an outstanding debt of
about RM600 million, had managed to arrive at a scheme with
its creditors on May 15 at a court-convened meeting,
without resorting to capital reduction.  The scheme
involved both Redeemable Convertible Secured and
Unsecured Loan Stocks which may be issued, transferred or
assigned at the onset to one nominee of each creditor once
only.

Wong also said that the 40 million Econstate Bhd shares had
now been safely sold to Road Builder (M) Holdings Bhd.
He said the shares had been pledged to AMMB International
(L) Ltd and a notice of default under the loan facility had
been served. To prevent AMMB from foreclosing on the
shares, Pan Global had to sell its stake in Econstate to
settle its debts to AMMB.

There were shareholders who had objected to the sale as the
sale price of RM2 per share to Road Builder was below its
original purchase price of RM6 per share.  The shareholders
had obtained a court injunction to stop the sale thus
affecting the restructuring process, he said. Five minority
shareholders, in their bid to wrest control of the board,
had requisitioned an extraordinary general meeting to
remove five board members and nominate four new ones.

"We appeal to all shareholders to vote against the
resolutions to remove your directors," Wong added. (The New
Straits Times  27-May-2000)

PANGLOBAL BHD.: Directors sue 'various parties'
-----------------------------------------------
Directors of PanGlobal Bhd have filed court action against
"various parties" for unlawfully attempting to take over
the company.

"You basically have a small group of minority shareholders
wanting to take over the board...without making a mandatory
general offer, which is the basic primus of how public
listed companies are run," its chief executive officer
Alexander Wong Shoon Choy said.

He was referring to the requisitioning of an extraordinary
general meeting (EGM) for June 8 by five minority
shareholders to vote on a resolution to remove five
PanGlobal directors. They are Wong himself, Richard Wong
Shoon Fook, Bernard Wong Shoon Tet, Tan Sri Datuk Abang
Ahmad Urai and Low Chin Tong.

The shareholders have proposed that four professional
individuals, none of whom are currently shareholders, be
voted in to run the company.  They are Syed Zaid Syed
Jaffar Albar, Tan Chee Seng, Lau Tiang Hua and
Chung Weng Keong.

"It is further accentuated in our particular case, because
PanGlobal is a listed company that owns a financial
institution, PanGLobal Insurance Bhd. Section 67 (of the
Insurance Act) states very clearly that when you want to
take control of any company that owns a financial
institution, you will first need Bank Negara Malaysia's
approval.

"There is no such approval...if there is, we would have
seen it by now," Wong said at a press conference in Kuala
Lumpur yesterday.

He would not disclose who were named in the court action,
but said that it was not necessarily against the five
minority shareholders - Chin Jit Pyng, Leong Lai Fun, Siow
Moon Yeow, Siow Moon Seng and Koh Chit Koon.  The dispute
stems from the objection of some minority shareholders
towards PanGlobal's disposal of a 26.67 per cent stake in
Econstates Bhd to Road Builder (M) Holdings Bhd for RM80
million.

The sale was part of the company's RM600 million debt
restructuring scheme. The minority shareholders had noted
that the stake in question was worth RM260 million based on
net tangible assets.  The company had obtained
shareholders' approval for the sale at an EGM last year,
but was prevented from proceeding with it by a court
injunction obtained by a minority shareholder.

The 40 million Econstates shares in question were pledged
with AMMB International (L) Ltd for a loan facility, on
which a notice of default had been served, meaning the
shares could be disposed of at any price, PanGlobal had
explained earlier.

As such, it was "only prudent to secure the highest
bidder", it said. "The present board of directors is
working so hard to restructure the  company. Part of the
restructuring involves making decisions that may not be
palatable, but needed to be made nevertheless.  As the
bankers know that we are progressing towards a successful
restructuring scheme, our share prices had started to move,
and we had indications that we were moving in the right
direction," Wong said.

"I personally wonder if the minority shareholders have the
interests of the company at heart. Just as we're moving
along in an expeditious manner, court actions are being
taken to slow us down...saying they want to protect the
rest of the minority shareholders," he added.  (Business
Times  27-May-2000)


=====================
P H I L I P P I N E S
=====================

PHILIPPINE NAT.BANK: Tan, Gov't draw sale fallback option
---------------------------------------------------------
The Estrada administration and taipan Lucio Tan will form a
"new gameplan" for the Philippine National Bank (PNB) in
case the bidding of their fused 76-percent stake fails.

"We will put a new gameplan together if it does not
succeed," Finance Secretary Jose T. Pardo disclosed in a
recent interview.

Details of the fallback option were not yet clear but
according to Pardo, both parties remain optimistic that the
30-percent government stake and 46-percent Tan equity would
be auctioned off at a "fair price" in June 9 this year.
This is in contrast to an earlier agreement between the
government and Tan that they would go their own way should
the auction bog down.

Three parties have already prequalified: the Rizal
Commercial Banking Corp. of the Yuchengco group, a
consortium headed by Filipino-American billionaire Loida
Nicolas Lewis, and an Indonesian group.  Moreover, two more
investors -- one a "prominent local and landed family --
"are ready to buy PNB in case of a failed bidding," said
Pardo.

Identities of the entities who failed to meet the deadline
for prequalification last week were still withheld.
Pardo said himself, Tan, and Bangko Sentral ng Pilipinas
(BSP) Governor Rafael B. Buenaventura would meet within the
week to deliberate on the price of their combined shares.

Meanwhile, the Finance chief said that Tan wants the
government to occupy only four board seats in PNB instead
of the proposed five, because it is just a minority stake
holder.  Such stance apparently derailed its list of five
nominees to represent the government in the bankformer
Supreme Court chief justice Andres Narvasa, former labor
secretary Nieves Confesor, former BSP deputy governor
Feliciano Miranda (presently PNB president), Cielo
Macapagal (sister of Vice President Gloria Macapagal-
Arroyo) and Rodolfo Marquez.

"He (Tan) said that (only) four (government nominees should
sit in the PNB board) because we are now a minor
shareholder," said Pardo.

Also nominated to represent the 12.9-percent stake of Hong
Kong-based Templeton Investment Inc. in PNB was businessman
Roberto Romulo and SGV co-founder Washington Sycip in
behalf of the private sector minority shareholders." (The
Manila Times  30-May-2000)

PHILIPPINE NAT.BANK: Audit reveals extent of bad loans
------------------------------------------------------
Philippine National Bank may be in bigger trouble than what
its officials are portraying.  A special audit done by
PricewaterhouseCoopers completed December 1999 claimed that
based on International Accounting Standards (IAS), PNB's
ratio of non-performing loans (NPL) as of June 1999 was at
a high 39 percent.

Worse for PNB, the bulk of its non-performing loans have
been granted to only a small number of big corporations,
which included government-related firms.  Based on data
contained in the PricewaterhouseCoopers audit, a big chunk
of PNB's problem loans--by the auditing firm's criteria--
were extended to firms owned by individuals close to former
President Ramos' administration.

Among these are Ramon Jacinto's firm, the Guoco Group which
was the proponent of the controversial Amari land deal, the
Antipolo and Marilaque Properties group controlled by
former chief of staff Lisandro Abadia, Jose Alvarez's
Columbian Motors, and the AFP's Retirement and Separation
Benefits System (RSBS).

However, a few of President Estrada's known friends also
have huge outstanding loans with PNB, the biggest of which
are Lucio Tan's and William Gatchalian's conglomerates.
PNB's NPL ratio may have even gone past 50 percent now
based on the more internationally accepted IAS, a former
ranking PNB officer says. The banker explained that
PricewaterhouseCoopers' 39-percent estimate was as of June
1999, when PNB was claiming only a 28-percent NPL.

PNB president Feliciano Miranda has recently disclosed that
the bank's NPL had grown to 31 percent as of April this
year. That NPL though was based only on the Bangko
Sentral's criteria and not on the IAS.  IAS criteria, on
the surface, are less stringent, as it classifies a loan as
an NPL if it is three months' overdue. On the other hand,
the Bangko Sentral regulations require that an account is
an NPL if it is just a month overdue.

However, the IAS' criteria are tighter since they have a
qualitative grading. An account may be categorized as an
NPL if it is classified as "substandard" or worse
("doubtful" and "loss"). These categories are based on the
debtor's poor repayment history on his loan and his firm's
financial condition.

The PricewaterhouseCoopers audit pointed out that PNB might
have under-reported its level of bad loans for two reasons.
First, restructured loans were not considered as NPLs. This
was the case for the $112-million loan of the Ramon Jacinto
group as well as those of National Steel and Philippine
Airlines.

Metro Pacific Group subsidiary Bonifacio Land's P1.9
billion in loans from PNB were also classified by
PricewaterHouseCoopers as "substandard" as it "was able to
settle only 50 percent of its debts in March 1999 and PNB
granted an extension (the second time) on the firm's
request to defer principal repayments to February 2000."

Second, the audit firm pointed out, "past due loans granted
to government-related corporations were excluded from the
NPL ratio," as in the case of the AFP-RSBS' P1.3-billion
debt. Another example is the Bureau of Customs, which has a
P1.7-billion loan from PNB, unpaid since 1997. The bank
though has been classifying it as a performing loan. The
PNB claims that such exclusion is due to the fact that the
loans, since they are to government-related institutions,
are "sovereign" or risk-less loans.

In the case of the Bureau of Customs, the PNB in effect has
been funding part of the government deficit. The amount was
used by the bureau to pay its fees to the Societe General
de Surveillance, the Swiss firm which checks on the
valuations of imports to the country.

For a bank initially intended by the government to cater to
small- and medium-sized firms, PNB's loan portfolio, the
PricewaterhouseCoopers audit pointed out, "is concentrated
in a small number of large-size corporate loans, the
majority of which are collateralized by real estate."

This is basically the source of PNB's financial problems.
The auditing firms closely evaluated 40 of PNB's biggest
loan accounts, each of which were at least P400 million,
totaling P54.4 billion. It found that 31 of these accounts,
amounting to P38.7 billion or 71 percent of the total, are
problem loans which should be classified as NPLs.

Several of these firms--such as Gotesco, Eyco and Uniwide--
have already declared their inability to pay their debts
not only to the PNB but also to other bank-creditors.
While the list of PNB's biggest borrowers is a who's who of
Philippine big-business, a number of them are relatively
obscure in the country.

According to the audit, one of PNB's biggest problem loans
amounting to P2.7 billion and classified as "substandard"
was incurred by a "G.T. Pena Group." About P2 billion of
this was used in investing in Hong Kong properties. A
former PNB official claimed that the firm's owner who lives
in Hong Kong has a yacht where the bank's officials
together with their wives were regularly dined and wined.
Another is what the audit firm named as "Sps Hong & Gloria"
which has a P748-million loan from the PNB. The firm isn't
listed in the telephone books.

The PricewaterhouseCoopers' audit found that PNB's loan
portfolio had been focused on such a small number of big
borrowers that 10 business groups have exceeded the BSP's
single-borrower lending limit. The regulation prohibits a
bank from extending to any single entity more than 25
percent of its unimpaired capital and surplus.

The audit also reported that a major factor for the growth
of PNB's NPL is that 33 percent of its loan portfolio is in
foreign currencies. "Due to the significant deterioration
of the peso against the dollar during the Asian crisis, and
the significant increase in interest rates, many of PNB's
creditors were adversely affected and have had difficulty
in servicing their debts," the audit pointed out.
(Philippine Daily Inquirer  30-May-2000)

PHILIPPINE NAT.BANK: Lewis,Templeton join forces to bid
-------------------------------------------------------
A group headed by Filipina-American multibillionaire Loida
Nicolas Lewis and Hong Kong-based Templeton Asset
Management Ltd., along with a North American financial
institution, will join forces in a bid to acquire control
of losing Philippine National Bank (PNB).

"Templeton is part of us now," Lewis said in an interview
after the PNB annual stockholders' meeting yesterday.

In a separate interview, Templeton executive vice president
Allan Lam said there is still no final agreement if they
will bid together with Lewis' group. "It is one of the
options we are looking at," Lam told reporters. Global fund
manager Templeton Asset Management Ltd. holds a12.9-percent
stake in PNB.

Lewis said a consortium is being formed to join the bidding
for PNB scheduled on June 9.  Lewis, a native of Sorsogon,
said she became a stockholder of PNB only last April when
she started accumulating PNB shares through the local stock
market.  She said the consortium will be composed of two
groups. The first one will be the financial institution
while the second group will be represented by Filipinos in
the United States who have "achieved the American dream."

"It has been an emotional attachment. All of us, including
myself and my family, want to see PNB regain its previous
status of being the premier bank of the Philippines," Lewis
said, when asked why she suddenly became interested in
buying PNB.  "I have plans to make PNB great again."

This group of US-based Filipinos, Lewis said, believes on a
mission inspired by the slogan "Balik Yaman Para sa Bayan."
"I will encourage them (Filipinos based in the US) that
this is the right time to invest in the Philippines," she
stressed.

Lewis, who was described by the minority shareholders of
PNB as "the savior of PNB," gained prominence in the US
after she inherited TLC Beatrice, a snack-food, beverage
and grocery-store conglomerate, from her intense and
charismatic late husband Reginald Lewis.

In May last year, however, Lewis liquidated TLC Beatrice
which at its peak in 1996, according to Fortune magazine,
had sales of $2.2 billion and was listed No. 512 in
Fortune's 1,000 Top Corporations. It was the highest
position ever attained by a black-managed company.

Lewis said her group is also looking at the possibility of
tying up with a local-based bank like the Yuchengo-owned
Rizal Commercial Banking Corp. (RCBC) to strengthen their
bid for the bleeding bank.  RCBC was one of the three
bidders which pre-qualified for PNB's auction on June 9.
The other pre-qualified bidder was Le Bong Tanduy, an
Indonesian firm with a tie-up with a US financial
institution.

She said the group has already contracted the services of
ATR, an international investment firm, to be their
financial advisor.  Lewis expressed optimism that with her
mission, their group will win the battle for the country's
former premier bank.  (Philippine Star  31-May-2000)

PILIPINO TELEPHONE: Losses far from over
----------------------------------------
First Pacific's Philippine mobile-telephone operations will
continue to make "substantial losses", according to Michael
Healy, chief operating officer and finance director.

How quickly wholly owned Pilipino Telephone (Piltel) could
become profitable would depend on the success of a new
marketing plan, Mr Healy said.  Mr Healy, at First
Pacific's annual general meeting, said the quickness of a
turnaround would also depend on cost-saving measures that
had been put in place.

"From its first-quarter results, notably, it will continue
to make substantial losses."

First Pacific also holds a 23 per cent stake in Philippine
Long Distance Telephone (PLDT), the country's largest
telephone operator, into which it injected its mobile-
telephone operation - Smart Communications - last June.

Earlier this month PLDT reported an annualised 91 per cent
drop in earnings to 110 million pesos (about HK$19.8
million) for the three months to March 31.  The company
said earnings were hit by higher marketing and sales costs
associated with its mobile-telephone services.

In First Pacific's annual report, executive chairman Manuel
Pangilinan said Piltel was set to continue to experience
significant losses, and Smart's earnings contribution is
being constrained by its aggressive GSM (global system for
mobile communication) push.

"Smart's earnings are being constrained by aggressive
marketing for GSM," said Mr Pangilinan, who is also
Piltel's chief executive.

Mr Healy said First Pacific had no immediate plans to
expand into the mainland but would continue to restructure
its property business and telecom operations.  He said the
company could exercise a share option to subscribe to
shares of China United Telecommunications Corp (China
Unicom) when it goes public next month.

In March, First Pacific reached an agreement with China
Unicom to terminate two mobile-telephone joint ventures in
Fujian and Shenzhen.  Under the agreement, First Pacific
will receive cash proceeds of US$86.7 million, and warrants
to subscribe to US$54.30 million worth of Unicom shares,
once it goes public.  Yeserday, First Pacific's shares
dropped 25 HK cents to finish at HK$2.37.  (South China
Morning Post  30-May-2000)

URBAN BANK: Bank of Commerce pact `no problem to bidding'
---------------------------------------------------------
The agreement for the purchase of Urban Bank by Bank of
Commerce will not affect the bidding for the closed bank,
Philippine Deposit Insurance Corp president Norberto
Nazareno said.

He said the purchase agreement between Bank of Commerce and
Urban Bank shareholders does not give Bank of Commerce an
edge over the rest of the interested buyers.

"As far as we are concerned, the bidding will continue as
is. We will evaluate the five other proposals," Nazareno
said, adding that the deposit insurance is not part of the
pact between Bank of Commerce and Urban Bank.

Interested bidders have until June 12 to submit their bids,
he said.  Urban Bank, which has been closed since late
April, is under the receivership of PDIC.  Finance
secretary Jose Pardo earlier said Rizal Commercial Banking
Corp, Allied Banking Corp and Bank of Commerce are among
six banks interested in acquiring Urban Bank.  (AFX News
Limited  29-May-2000)

URBAN BANK: Shareholders clear sale to Commerce
-----------------------------------------------
Urban Bank, the largest Philippine lender to fall victim to
the 1997 Asian financial crisis, will be sold to the Bank
of Commerce, according to an Urban Bank shareholder.

Social Security System (SSS) chief Carlos Arellano said an
agreement with the Bank of Commerce was signed by Urban
Bank shareholders last week.  SSS, a state-run pension fund
for private employees, owns a 15 per cent stake in Urban
Bank, which has 1.2 billion pesos (about HK$216.48 million)
in market value.

Authorities seized Urban Bank last month after the lender
was unable to meet a wave of withdrawals sparked by
speculation the bank's viability was threatened by the
property exposure of its investment unit.

Bank of Commerce, a lender with 16 billion pesos in assets,
is controlled by the family of Antonio Cojuangco, chairman
of Philippine Long Distance Telephone, the nation's largest
telephone company.  For the purchase to go ahead, Bank of
Commerce must submit a rehabilitation plan for approval by
regulators.  No such plan has yet been submitted, according
to Norberto Nazareno, president of Philippine Deposit
Insurance Corp, which took over the bank on April 26.
(South China Morning Post  30-May-2000)

URBAN BANK: Officials violated DOSRI rules - BSP
------------------------------------------------
The Bangko Sentral ng Pilipinas (BSP) has uncovered some
DOSRI (directors, officers, stockholders and related
interests) violations against officers and directors of
defunct Urban Banking Corp.

Informed sources from the BSP said the monetary authorities
have apparently discovered that Urban Bank founder and
chairman Arsenio Bartolome III and president Teodoro
Borlongan, among others, have exceeded the 15-percent
prescribed DOSRI limit imposed by the BSP.

Under BSP rules, a bank is prohibited from issuing DOSRI
loans amounting to more than its capital funds or beyond 15
percent of its total loan portfolio, whichever is higher.
According to sources, the loans granted to the officers
were apparently used to rescue Urban Bank's bleeding
subsidiary, Urbancorp Investment Inc.  Urbancorp suffered
from financial difficulty after some of its investors
pulled out their investments in the company.

Sources said these DOSRI loans might have aggravated the
liquidity problem being faced by Urban Bank that had
started when it announced its plan to convert into a thrift
bank. The announcement led to enormous withdrawals of
deposits leading to a bank run that eventually resulted to
closure of the bank.

BSP sources said the Monetary Board, the policy making body
of the BSP, has turned over its findings to the Department
of Justice (DOJ) for filing of possible charges against
these officials.

"The DOJ is sifting (the BSP findings) to decide what case
it would file against Bartolome and Borlongan, at least
whether it would be civil or criminal. The BSP is leaving
it to the DOJ," the sources said.

In an earlier press conference, Bartolome and Borlongan
denied they have DOSRI loan problems.  BSP sources said any
official of Urban Bank who will be found guilty of banking
malpractice would definitely be "banned" from the industry.

"Bartolome and Borlongan could no longer be bank officials.
I don't think they could be (bank) stockholders also and
definitely, they will not receive any single centavo when
Urban Bank is already fully rehabilitated. The
rehabilitation (program) does not exonerate them from the
(possible legal) cases," the sources said.

The STAR tried to get the side of the Urban Bank officials
but failed.  As this developed, BSP Gov. Rafael
Buenaventura said yesterday the Philippine Deposit and
Insurance Corp., the receiver of Urban Bank, has yet to
identify the final buyer of Urban.

As of now, those investors that have indicated interest in
buying Urban include: Rizal Commercial Banking Corp.,
Allied Banking Corp., Keppel Tattle Bank of Singapore, and
the Banque National de Paris.  The other day, it was
reported the Urban Bank shareholders have signed a
memorandum of agreement with Bank of Commerce for a
possible buyout of the assets of Urban Bank.

Urban Bank's largest corporate depositors/investors
include: Social Security System which owns 15 percent of
the bank; Petron Corp., San Miguel Corp., and Manila
Electric. Co. (Philippine Star  31-May-2000)


===============
T H A I L A N D
===============

iTV: Directors approve 40% stake for Shin Corp
----------------------------------------------
iTV directors yesterday approved a restructuring plan
giving Shin Corporations a 40% stake in the television
station.

Prakit Pradipasen, iTV chairman, said directors approved
the company's restructuring plan as proposed by the firm's
major creditor, Siam Commercial Bank.  The plan calls for
capital to be increased by 550 million baht to 1.55 billion
baht.  Shin Corp will pay 261.3 million baht for a 17%
stake, with 288.7 million paid by Siam Commercial Bank,
which will hold a 19% stake.

Payment for the new shares would be made on July 2, and
used to settle the station's concession payments due to the
government.  Shareholders will then be asked to approve a
capital writedown from 1.55 billion baht to 387 million
baht to offset outstanding debt.  Capital will then be
raised again to 4.5 billion baht, with Shin purchasing new
shares to ultimately hold a 40% stake. Siam Commercial Bank
will also convert some of its outstanding debt for new
equity in the firm.

Prices and details of the Shin share sale and the debt-to-
equity swap were still under negotiation, Mr Prakit said.
Once iTV was listed on the Stock Exchange of Thailand,
existing shareholders, such as Nation Multimedia, JSL and
the Kantima Group, would be issued 25 million five-year
warrants with the right to purchase common shares at an
exercise price 20% below the initial public offering price.

Shin Corp and Siam Commercial Bank would not be offered
warrants.  Mr Prakit said all procedures were expected to
be completed within three months.

"This is the best option for iTV," he said. "The company's
financial position now is very poor compared with other
television stations."

But Mr Prakit said that revenue had doubled each year since
1998, and he was confident that after restructuring, the
firm would be able to post a profit.  The company's
interest burden would be immediately eased, with current
total debt falling to about one billion baht from four
billion baht. The company currently pays interest of around
300-400 million baht per year.

Suthichai Yoon, an iTV director and Nation editor-in-chief,
acknowledged that he had "lost the fight" against the
restructuring plan.  He said he was unable to say whether
Nation wanted to invest in iTV further, given the
uncertainties in the company's policies after
restructuring. (Bangkok Post  31-May-2000)

iTV: Clarification to SET on debt restructuring
-----------------------------------------------
As financial supporter of ITV Public Company Limited, the
Siam Commercial Bank Public Company Limited is in the
process of restructuring the company's debt, and hereby
clarifies that assistance.

SCB has given financial support to ITV PCL, operator of ITV
broadcasting station, as the Bank believed the project was
viable and beneficial to the general public. ITV's
financial performance has been weak as a result of the
economic recession.

The Bank has tried to resolve ITV' s problems by seeking
the amendment to the terms of the concession in order to
seek a listing the company on the SET, and exploring
various options for the company's recapitalisation via a
rights issue and bringing in new investors to restore the
company 's financial health.

The Bank's proposed package for ITV debt restructuring and
recapitalisation follows the Bank of Thailand's directives.
The package consists of a debt-equity swap and an injection
of fresh capital from new investors. The Bank's main
concern when considering the investment proposals was to
secure the potential investor's guarantee of the station's
independence and integrity to uphold the spirit of the
concession and to have a complete one time solution to the
company's financial situation.

On this basis, the Bank selected Shin Corporation PCL to be
ITV's new investor as it is financially strong, is a
publicly - owned company in the telecom business, and
should be in the best position to operate future digital TV
& telecom technology.

ITV's debt & capital restructuring package calls for an
increase in the company's paid up capital to Bt4,500mn with
Shin Corporations PCL as the new shareholder. Post the
capital increase, the new shareholding structure will be:
the Bank 43%, Shin Corporation PCL 39%, and existing
shareholders 18%. ITV will use the proceeds from the
capital increase to pay its creditors' loans and the
concession due for 2000. After loan repayment, ITV's
outstanding debt will decrease to approximately Bt1,000mn
and the repayment terms will be restructured.

As already explained in the company's recent press
announcement, the capital and debt restructuring process
referred to above was approved by ITV's Board of Directors
on May 30, 2000. The agreement will sustain ITV's
independence and financial viability. ITV will be able to
continue providing news and quality TV programmes to the
public & maintain its independence.  (Stock Exchange of
Thailand  31-May-2000)

PROPERTY PERFECT PLC: BOA files for its bankruptcy
--------------------------------------------------
Bank of Asia Plc has filed a bankruptcy charge against
Property Perfect Plc for the debt value of 81 mln baht
covering both principal and interest, it said in a petition
to the Central Bankruptcy Court dated May 16.

In the petition, Bank of Asia said since its purchase of 70
mln baht worth of Property Perfect's debentures in 1997, it
has become an unsecured creditor of the company as Property
Perfect failed to pay interest of 11 mln baht for the
debentures.  Property Perfect later informed all debenture
holders, including Bank of Asia, that it was unable to
service its debt.

The Central Bankruptcy Court has scheduled its first
hearing on the case June 2.  Property Perfect has been
suspended since May 16 on its failure to submit its
quarterly financial statement ending March 31. It is also
currently categorised as under rehabilitation. Property
Perfect Plc officials declined to comment.

"Property Perfect is not in a position to repay debts. It
also informed the other bond holders that it was unable to
repay the principal and interest at maturity," said a bank
statement.

Property Perfect recently listed in the Companies Under
Rehabilitation (Rehabco) sector, reporting a net loss of
1.7 billion baht for the first nine months of last year.
The company's total liabilities stood at 15.97 billion baht
while its total assets were 10.05 billion baht. Its paid-up
capital was 778 million baht.

Property Perfect executives could not be reached for
comment on the bankruptcy suit. The company is now working
with creditors to restructure its 10 billion baht debt.
But analysts argue foreign partners are needed to help
boost its financial strength.  However, no further details
about the restructuring progress are being made available
by the company.

Thirty percent of the company's debt is owed to foreign
creditors, mainly South Koreans who do not hold collateral.
The remaining 70% of debt is owed to Thai banks and
financial institutions that have collateral, as well as to
bond holders.  This year, the company has been trying hard
to raise cash and clear its inventory of mainly detached
houses and townhouses at residential projects in Rangsit
and Bang Bua Thong, at 30%-35% discounts.  (Bangkok Post
31-May-2000, AFX News Limited  30-May-2000)

SIKARIN PLC: SET suspends trading, faces delisting
--------------------------------------------------
The Stock Exchange of Thailand (SET) announced Sikarin
Public Company Limited (SIKRIN) may face possible of
delisting and allowed trading in the securities of SIKRIN,
which decided to prepare a rehabilitation plan from 2 May
2000 - 1 June 2000, to give shareholders an opportunity to
trade the company's securities. (Details have been
available in PUBLIC SIMS on 28 April 2000.)

Now, the trading period of SIRKIN has already been
terminated, according to Clause 5(5) of the SET' s Rules,
Conditions and Procedures of the Temporary Prohibition
against Trading of Listed Securities dated on 9 February
1995. Therefore the SET posts an SP sign to prohibit
further trading in SIKRIN's securities from 2 June 2000
until the caused of delisting will be eliminated.

SIKRIN is now required to proceed as follows:
1) Appoint an independent financial advisor to jointly
prepare a rehabilitation plan to solve the causes of
delisting.

2) Prepare a rehabilitation plan to solve the causes of
delisting according to Clause 30/4 of the Notification of
the SET regarding the Rules Governing the Delisting of
Securities. The company must also appoint a financial
advisor to jointly prepare a rehabilitation plan and
propose to its shareholders within 4 months of the date of
notice-received or by 5 July 2000.

3) SIKRIN and its advisors must report on the progress of
the company's operations, comparing the results of its
operations to the rehabilitation plan every 3 months to the
SET, until the causes of delisting have been eliminated.

The SET would like to ask the company's shareholders and
general investors to follow up the proposed rehabilitation
plan prepared by the company and its financial advisors
which will be presented to its shareholders meetings.
(Stock Exchange of Thailand  31-May-2000)

THAI DURABLE TEXTILE PLC: Strike threatened
-------------------------------------------
Workers of a textile firm yesterday threatened to launch a
work stoppage after their demands for a salary hike and a
mid-year bonus were rejected.

Ubon Rompothong, Thai Durable Textile Plc's labour union
leader, blamed the management for ignoring the plight of
workers.  She said the workers' salaries have remained
frozen for the last five years. "They deserve a bonus and a
pay rise because the economy has picked up".

The union leader said some 2,000 workers would join the
work stoppage. (Bangkok Post  31-May-2000)

THAI TEL.& TEL.: Debt plan passes
---------------------------------
Thai Telephone and Telecommunication Plc (TT&T) yesterday
received approval from the Central Bankruptcy Court to
oversee the restructuring of its 44.36 billion baht in
debts.

There was no creditors' vote as the Telephone Organisation
of Thailand had withdrawn the formal objection it had
submitted to the court earlier to block TT&T as the
planner.  The TOT and TT&T reached a compromise last week
over the repayment of debts owed by the provincial fixed-
line operator to the TOT.

Witit Sujjapong, TT&T executive vice president, said it
would take about two months to complete the plan, and the
TOT would be invited to take part.  He said the rental fees
the company owed the TOT for long-distance circuits would
be stated clearly in the plan.

TT&T owes 3.6 billion baht to the TOT, but says the state
agency owes the company 1.6 billion baht for other
services, leaving a net debt of two billion. The TOT had
claimed the figure of 3.6 billion in its earlier petition.
Mr Witit said the debts owed to the TOT would be paid only
after all creditors approved the plan.

The plan calls for TT&T to convert six billion baht owed to
Jasmine International, Ital-Thai and NTT to equity, raising
TT&T's capital to 18 billion baht from 12 billion. It would
then increase capital by a further five billion baht by
offering shares to new partners. (Bangkok Post  30-May-
2000)


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