Weak Audit Fueled Century Mess, Former Bank Indonesia Governor Says
Former Bank Indonesia governor Burhanudin Abdullah said on Monday that the central bank’s audit of the three lenders that merged to form Bank Century had been weak and this had contributed to the bank’s problems.
Burhanudin said that the weak audit of Bank Pikko, CIC and Danpac took place before he became the central bank governor.
“The central bank’s audit was very weak, Century is the proof of that,” said Burhanudin in a consultative meeting with the House of Representatives special committee investigating Bank Century.
Burhanudin admitted that he signed off on the merger of the three minor banks but he said the merger decision was not his.
“The decision to merge the three banks was made by a meeting of the central bank’s board of governors which took place before I became governor,” he said.
However, he added that the merger decision was understandable because Bank Indonesia had the intention to create a healthy banking climate in the country.
According to Burhanudin, the Bank Century scandal had ruined the reputation of Indonesian banking.
“National banking is in good condition. Century is the small error that spoiled everything,” he said.
JG
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