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                        A S I A   P A C I F I C

                 Friday, February 9, 2001, Vol. 4, No. 29

                               Headlines


A U S T R A L I A

AUSTAR:  Shares Record Low
COLES MYER:  Management Held Responsible


C H I N A  &  H O N G  K O N G

JILIN LIGHT: Predicts Losses
NINGBO MINING:  Fails To Turnaround Firm
NORTHEAST ELECTRICAL: Expects Losses


I N D O N E S I A

BANK INDONESIA:  Moody's Set to Downgrade Ratings
PT BANK CENTRAL ASIA:  Government Delays Sale
PT BANK NIAGA:  Sale Postponed


J A P A N

ITOCHU:  Disposes of Subsidiaries
NIIGATA BANK:  Four Executives Arrested


K O R E A

HAITAI:  Looking For Negotiator
HANIL LIFE:  Fails To Attract Investors
SAMSHIN LIFE:  Attracts Investors


M A L A Y S I A

RHB CAPITAL:  Future Uncertain


P H I L I P P I N E S

NATIONAL STEEL: SEC Reconsiders Liquidation Order
URBAN BANK:  Central Bank Head Warns Ex President


S I N G A P O R E

ASIAXIS:  Decides to Close Operation


T H A I L A N D

THAI CANE:  Court Dismisses Creditors Petition
THAI PETROCHEMICAL:  Founder Files Labor Suit


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

AUSTAR:  Shares Record Low
--------------------------  
Shares of Austar, regional pay TV operator, fell to record lows on
confirmation that its core business lost customers in the December
quarter, according to the Thursday issue of the Sydney Morning
Herald.

Two months ago media analysts said Austar had been oversold when
it reached its lows; now they are saying the present share price
is justifiable given that its pay TV business is shrinking.

Austar said it lost a net 5,100 customers in the December quarter
and only added 39,402 new subscribers in the year to December,
well short of the 90,000 that was predicted by Austar chairman
Mike Fries at the company's annual general meeting last May.

Austar is also looking to finalise a $200 million loan from its
bankers. The company has $190 million in cash on hand, after
spending about $490 million last year.


COLES MYER:  Management Held Responsible
----------------------------------------
The board and management of Coles and Myer must be held
accountable for the inability to address chronic problems that
have plagued the group since the mid-1990s, according to the
Thursday issue of the Sydney Morning Herald.


Coles Myer revealed that the market it would be looking for full
year earnings of around $400 million, against analysts'
expectations of between $450 and $490 million. And most of the
forecasts had been arrived at since January downgrades.

Standard & Poors has placed the company on a negative credit
watch. S&P says that as a consequence of the weaker earnings
outlook CML's cash-flow protection measures -- which are already
weak -- for the rating category are expected to deteriorate in
fiscal 2001.


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

JILIN LIGHT: Predicts Losses
----------------------------
St Jilin Light Industry Group Co. Ltd. has announced the company's
board does not foresee improvements in the company's performance,
according to the Thursday issue of the Quamnet News.

Presently the company shoulders a heavy debt burden and has not
decided on how to deal with the bad debts. The company has
experienced consecutive losses for three years.


NINGBO MINING:  Fails To Turnaround Firm
----------------------------------------
Ningbo Huatong, a computer software & hardware manufacturer, has
announced that it has failed to turn around its performance
despite strengthening internal management in the second half of
2000, according to Thursday's Quamnet News.

The information network project invested by the company has not
produced profits. The company is expected to see huge losses for
2000.


NORTHEAST ELECTRICAL: Expects Losses
------------------------------------
Northeast Electrical Transmission & Transformation Machinery
Manufacturing Ltd., a Chinese state-controlled company that makes
equipment for electricity distribution, said it expects to record
losses for the year 2000, Quamnet News Service reported on
Wednesday.

The losses were attributable to intense market competition, a
decrease in prices of products and sales income from principal
activities, it said, adding that the losses will have negative
effects on company operations.

The company expects to publish its final results by the end of
April. The stock was untraded at 23 HK cents.


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

BANK INDONESIA:  Moody's Set to Downgrade Ratings
-------------------------------------------------
Moody's Investors' Service said it had put Bank International
Indonesia (BII) under review for a possible downgrade, citing a 43
million dollar payment default by its sister company PT Tjiwi
Kimia, Agence France-Presse reported on Monday.

The ratings agency added that the review will be on BII's long-
term deposits rating of Caa1, and its general financial strength
rating of E-plus but would not affect its short-term deposits
rating.

Since BII has large exposure in Sinar Mas companies, this will
have negative implications in the bank's asset quality.

The deal it is presently negotiating whether to let the Indonesian
Bank Restructuring Agency (IBRA) guarantee or assume its debt
default and it's a subject for a political debate. Rizal Ramli,
Indonesia's coordinating economics minister, said the
government was studying ways of resolving BII's capital problems.

The government had previously agreed to take over Sinar Mas
group's debt to BII, worth around 1.2 billion dollars, in a bid to
support the bank and raise its capital adequacy ratio to above 10
percent.


PT BANK CENTRAL ASIA:  Government Delays Sale
---------------------------------------------
The Indonesian government has decided to delay the divestment of
stakes in two banks -- PT Bank Central Asia (P.BCA) and PT Bank
Niaga (P.BNA) -- among the targets set by the International
Monetary Fund in its last letter of intent with Indonesia,
according to Dow Jones on Tuesday.

Indonesia's failure to sell these banks has contributed to the
fund's decision to delay a $400 million loan due in December under
a three-year, $5 billion bailout program.

Indonesian Bank Restructuring Agency (IBRA), which controls the
banks, has failed to present sufficient data to justify selling
the banks in the first half of the year. IBRA and the parliament
agreed to delay divestment of Bank Niaga and BCA in the first half
of 2001.


PT BANK NIAGA:  Sale Postponed
------------------------------
The sale of PT Bank Niaga will be postponed during the first half
of the year because of a delay in its bailout program. The
Indonesian Bank Restructuring Agency (IBRA) delayed a $400 million
loan due in December under a three-year, $5 billion bailout
program, according to a Tuesday report by Dow Jones.

PT Bank Central Asia (P.BCA) and PT Bank Niaga (P.BNA) were among
the targets set by the International Monetary Fund in its last
letter of intent with Indonesia. IBRA failed to justify the sale
of the two banks before the IMF.


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

ITOCHU:  Disposes of Subsidiaries
---------------------------------
Itochu Corp. is set to liquidate two unprofitable subsidiaries in
Japan and recently sold an unprofitable U.K. unit, the trading
house said, according to the Wednesday issue of the Asian Wall
Street Journal.

Itochu expects to incur a total loss of 22 million yen ($191,872)
on a consolidated basis and 92 million yen on an unconsolidated
basis from the liquidation of the two Japanese subsidiaries. The
firm also estimates a 300 million yen loss from the sale of the
U.K. unit.

The company has factored these losses into its earnings estimates
for the current fiscal year, which ends March 31.

Itochu will liquidate Ford Century Inc., its fully owned Japan
dealer of Ford Motor Co. cars, and nonlife-insurance marketing
firm Japan Asia Re Ltd., in which the trading house has a 73
percent stake, it said.

Itochu said it sold JC No. 3 (U.K.) Ltd. to River Court Holdings
Ltd. on Feb. 2.


NIIGATA BANK:  Four Executives Arrested
---------------------------------------
Four former executives of the failed Niigata Chuo Bank were
arrested Wednesday on suspicion of extending unlawful loans to a
financially troubled golf club.

They include two former presidents, Ryutaro Omori, 73, and Hiroshi
Eimura, 64. All four are suspected of violating the Commercial
Code, the Yomiuri Shimbun reported on Thursday.

The executives were suspected to have channeled most of a 3.03
billion yen loan originally extended to a golf-membership sales
firm affiliated to the bank to financially troubled Fuji Chuo Golf
Club Co. in Kamikuishikimura, Yamanashi Prefecture.

Police believed the four engaged in so-called roundabout lending,
in which companies obtain loans and then pass them on to firms in
financial difficulty.

Fuji Chuo Golf Club was unable to sell many memberships because of
its inconvenient location. It had run a monthly deficit of more
than 100 million yen since it opened in October 1995.

Nine loans, the second, worth 98 million yen, and those made
thereafter were extended after the Financial Supervisory Agency
started giving non-binding instructions to financial institutions
over inadvisable lending practices in June 1999.

The bank had already filed against Omori and Eimura on suspicion
of an aggravated breach of trust.


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

HAITAI:  Looking For Negotiator
-------------------------------
Haitai Confectionery Co., under a debt-restructuring program, is
looking for a priority negotiator together with Cho Hung Bank for
its planned sale, according to the Wednesday issue of the Korean
Herald. Five to six would-be buyers have expressed their intention
to take over Haitai Confectionery, while most of them are foreign
companies.

Hong Chil-son, the head of the bank's lending business, said the
confectionery maker could fetch a minimum of 700 billion won to
800 billion won, given its good will and distribution network.

No single domestic company has expressed an intention to acquire
Haitai Confectionery, Hong said.

Haitai Confectionery has been put under a debt workout program
since its parent Haitai Group went bankrupt in the wake of a
foreign exchange crisis in late 1997.


HANIL LIFE:  Fails To Attract Investors
---------------------------------------
Hanil Life Insurance Co., one of three ailing firms put up for
sale, has failed to attract interest from any potential buyer, the
Korea Herald reported on Monday.

The Financial Supervisory Commission (FSC) will normalize Hanil if
its majority shareholder recaptializes the company and reduces its
excessive borrowing. If that is not the case, it will be
liquidated after transferring its contracts to other insurers.

The life insurance company tried to recapitalize since it was
categorized by the FSC as a poorly managed financial institution.

Even though it managed to raise capital by 20 billion won, it did
not fulfill the government's requirement to collect its loan to
Ssangyong Cement Industrial Co.


SAMSHIN LIFE:  Attracts Investors
---------------------------------  
Lucky Life Insurance and Tong Yang Life Insurance have expressed
an interest in taking over Samshin Life placed up for sale by the
Financial Supervisory Commission (FSC). FSC officials said Lucky
has expressed an intention to acquire Samshin, while Tong Yang is
willing to take over either of the two, the Korea Herald reported
on Monday.

The FSC plans to receive proposals from the two potential buyers
by Feb. 17 and select preferred bidders by Feb. 19. Then the
bidders will be given two months to conduct due diligence before
starting negotiations for contract conclusion.


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

RHB CAPITAL:  Future Uncertain
------------------------------
Prominent Malaysian banker Abdul Rashid Hussain faces an uncertain
future as executive chairman of RHB Capital after last week's
government ruling against his restructuring plans for the
financial group, according to the Thursday issue of the Business
Day Thailand.

The ruling and Abdul Rashid's apparent fall from favor have put a
cloud over RHB Capital shares, which closed more than 5 percent
down at 2.91 ringgit on Tuesday, as some analysts rate the stock a
"sell."

Abdul Rashid's troubles have raised fresh questions about
Malaysian corporate governance, which could deter foreign
investors from putting their money into Kuala Lumpur shares. He
might be forced to ease his grip on RHB Capital's RHB Bank, one of
10 anchor banks due to remain after sectoral consolidation.

Last Friday, the finance ministry threw a wrench into Abdul
Rashid's plans when it vetoed RHB Capital's proposal to buy back
its shares in RHB Bank from bank recapitalization agency Danamodal
Nasional. RHB Capital's plan was considered by many analysts as
economically sound.

Abdul Rashid controls 7.6 percent of RHB Bank through a 55 percent
stake in RHB Capital.


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

NATIONAL STEEL: SEC Reconsiders Liquidation Order
-------------------------------------------------
The Securities and Exchange Commission is reconsidering its order
to liquidate the National Steel Corp. saying a "white knight" or a
strategic investor is likely to turn up in view of the better
economic prospects under the Macapagal-Arroyo administration.

Hottick Investment Ltd., the Malaysian-based firm owns over 80
percent of NSC, said it is confident that NSC would be able to
attract more serious investors now that the country has finally
resolved its leadership problems with the ouster of President
Estrada, the Manila Times reported on Thursday.

The Malaysian firm said that the "Corporation Code provides that
the jurisdiction of the SEC to order involuntary dissolution is
limited only to the grounds provided by existing rules such as
continuous inactivity of the corporation for at least five years,
commission of the corporation of ultra vires or illegal acts, and
the corporation was illegally organized."

It also chided the commission for rejecting its request for
additional time to finalize a working rehabilitation plan and
favorably acting upon the recommendation of the NSC receivership
committee to liquidate the assets of the steel firm without first
conducting a hearing as required under the agency's rules on
corporate recovery.

The SEC ordered the dissolution of NSC after its Malaysian owners
failed to submit an alternative plan to rehabilitate the ailing
steel firm. It did not find merit in Hottick's request for
additional time to file a new rehabilitation plan because the
latter failed to give specifics such as the timetable for the
period of negotiations with the potential investors.


URBAN BANK:  Central Bank Head Warns Ex President
-------------------------------------------------
Bangko Sentral ng Pilipinas (BSP) Governor Rafael Buenaventura
Was accused to have warned ex-president Joseph Estrada to withdraw
P140 million from Urban Bank two days before it was closed.

Buenaventura said he could not have tipped off Estrada since he
learned of the bank's impending closure only on the evening of
April 25. The next day, April 26, the bank was closed upon the
order of the BSP, according to the Thursday issue of the Manila
Times.

"The Central Bank does not know who deposits and withdraws from
the bank. He said this was due to the law on the secrecy of
deposits"' he said.

Representatives Joker Arroyo and Oscar Moreno, two of the
prosecutors during the impeachment trial of the former president,
said Estrada was able to withdraw over P140 million from the bank
on April 24. They said this was due to a tip given by
Buenaventura.

Urban Bank suffered a run on its deposits after reports that its
capital as a commercial bank was insufficient. Thus, it was
downgraded by the Central Bank from a commercial bank into a
savings bank. Some P4 billion in deposits were withdrawn from the
bank in just a week, forcing its owners to have it closed.

After it was closed, the bank was placed on the auction block by
the state-owned Philippine Deposit Insurance Corp. (PDIC). Several
local banks have expressed interest in the bank but it was Bank of
Commerce that won the bidding for Urban Bank's franchise and its
branches.


=================
S I N G A P O R E
=================

ASIAXIS:  Decides to Close Operation
------------------------------------
Asiaxis, a joint venture involving locally listed companies SMB
United and MediaStream, American company StockGroup.com, as well
as two individual investors decided to close it operation after it
cannot generate revenue to cover operating cost, CNET News
reported on Thursday. The company developed a portal that
delivered financial data, graphic information and research
materials on Asia Pacific equity markets.

StockGroup provided the technology, and got 19.24 percent of the
company, as well as S$700,000 in cash. SMB and MediaStream each
owned 28.27 percent of the company after investing S$950,00
apiece, while the remaining stakes were taken by the individuals
for S$500,000 each. In addition, SMB also provided a S$200,000
loan to the company.

At the end of September last year, Asiaxis' site had 2.5 million
monthly page views.


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

THAI CANE:  Court Dismisses Creditors Petition
----------------------------------------------   
The Central Bankruptcy Court has dismissed a petition filed by
Thai Farmers Bank Public Company Limited and Chantaburi AMC Public
Company Limited, creditors, opposing the Thai Cane Paper Public
Co. Ltd. rehabilitation plan.

Virapan Pulges, Chairman of Executive Committee Central Bankruptcy
Court, reported to the Stock Exchange of Thailand on February 7
after finding sufficient evidence to suspend.

To recall, Thai Cane's rehabilitation plan was submitted to the
Central Bankruptcy court in November 15 last year.

The company's financial statements for the first six months of
last year showed its assets totaled Bt6.8 billion while its
liabilities were Bt4.8 billion.

Picham Sukparangsee, legal adviser to Thai Cane Paper, said the
amount of the assets on the balance sheet did not reflect the real
financial health of the company, as it was being sued in three
civil cases.

The company was in no position to repay its Bt4.8 billion in debts
as it had only Bt51 million in cash, and all financial
institutions had stopped extending new credit, he said.


THAI PETROCHEMICAL:  Founder Files Labor Suit
---------------------------------------------
Prachai Leophairatana, the founder and former chief executive of
Thai Petrochemical Industry (TPI), has filed a complaint with the
Labor Courts, accusing Effective Planner (EP) of acting in breach
of labor laws when it stripped him of his post as the head of TPI.

Prachai said EP's move was against Thai bankruptcy laws, which
prohibit debt planners from changing the organizational structure
of a company, according to the Monday issue of Business Day.

He claims EP does not have the power to dismiss him.

EP, the court-appointed debt-restructuring firm, removed Prachai
from the position of chief executive last December, replacing him
with Anthony Norman, EP's managing director.

Prachai is no longer the CEO of TPI, but is working as an advisor
to implement the debt-restructuring plan, said Norman following
the dismissal. He added that the change was made to pave the way
for smooth plan implementation.



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

Troubled Company Reporter -- Asia Pacific is a daily
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Inc., Trenton, NJ USA, and Beard Group, Inc., Washington,
DC USA. Lexy Mueller, Managing Editor, James Philip P.
Jover and Maria Vyrna Nineza, Editors.

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

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The TCR -- Asia Pacific subscription rate is $575 for 6
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