[Menurut beberapa analis di A.S., rancangan dua-hala menukar matawang tidak akan mampu menolong negara dalam krisis matawang. Sistem itu sudah ketinggalan zaman sejak sistem apungan bebas matawang dipraktikkan. Namun begitu ia mungkin merapatkah hubungan antara dua negara berkaitan. Jepun dan Korea serta Malaysia dan Thailand sedang mengikat perjanjian tukaran melintang untuk mengelakkan serangan spekulatif keatas matawang. Itu sebenarnya tidak efektif kerana kelemahan sebenar adalah masalah dalaman negara sendiri. Lagipun persetujuan tukaran itu sudah pun ujud sebelum krisis 1997 itu lagi. Inisiatif Cheing Mai hanyalah nama baru untuk baju yang sudah tidak berfungsi itu lagi.

Menurut pakar ekonomi, rancangan penukaran itu lebih bersifat 'ilusi betapa seorang maharajah itu masih berpakaian lagi'. Lagipun Jepun masih mempunyai banyak masalah sehingga perdana menterinya bertukar acap kali kerana terlalu sukar membaiki ekonomi yang sudah teruk bercampur baur dengan kepentingan politik kroni.

Sistem penukaran matawang suka-sama-suka sudah pun dalam proses pelupusan di Amerika kerana ia bukan gambaran kedudukkan sebenar kekuatan wang negara. Ia hanya berguna pada era 70an sahaja. Kini sistem apungan bebas sudahpun menggantikannya dan Amerika tidak memerlukannya untuk muncul sebagai kuasa ekonomi dunia.

Sistem tukaran itu lebih merupakan untuk menggerunkan spekulator sahaja kerana pakatan itu menampakkan mereka kuat sahaja - padahal ekonomi dan matawang sedang sakit menggila. Dengan merosotnya rezab negara matawang akan tertekan dengan sendirinya tanpa perlu diserang sesiapa.

Matawang yen yang melemah kini bakal menyebabkan kekurangan pelaburan dari Jepun ke Malaysia. IMF baru-baru ini melapurkan pengilang Jepun sendiri seperti Sony dan Toshiba sudah beralih ke negara China yang lebih stabil dan murah kos buruhnya. Terpaksalah Malaysia melopong mulut ternganga.... Siapa yang pandai menguruskan ekonomi sebenarnya?

Rencana Asiawise memaparkan beberapa perkembangan menarik dalam bank tempatan selepas penggabungan. Untuk terus kompeteif mereka terpaksa menggugurkan pekerja dan menutup beberapa cawangan yang bertindihan. Pasaran saham kini sudah tidak mampu menyokong bank sentiasa - mereka terpaksa mencari peluang lain dengan mempromosi produk baru kewangan. Ia juga turut kehilangan penyimpan yang sudah beralih kepada syarikat mengurus dana (mutual fund). Kebimbangan NPL yang meningkat menyebabkan bank-bank lebih menumpukan pinjaman yang lebih selamat seperti sektor hartanah yang baru saja diberi beberapa kelonggaran.

Maybank mengumumkan akan menggugurkan 1,500 pekerja manakala CAHB pula sebanyak 2,000 orang. Dianggarkan 10,000 pekerja akan menjadi mangsa penggabungan bank.
- Editor]

http://asia.biz.yahoo.com/news/asian_markets/article.html? s=asiafinance/news/010509/asian_markets/dowjones/ ASEAN_Forex_Pacts_Aren_t_Safety_Nets__ U.S._Analysts_Say.html

Wednesday, May 9 2:47 AM SGT

ASEAN Forex Pacts Aren't Safety Nets, U.S. Analysts Say

By Jennifer Downey

Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)-- A series of bilateral currency-swap agreements between several Asian nations expected on the sidelines of this week's annual meeting of the Asian Development Bank may signal regional agreeement, but won't provide much economic stability, U.S. analysts say.

The reciprocal deals planned between Japan and South Korea, Thailand and Malaysia are touted as safety nets in times of speculative attacks on currencies, but can become ineffective stop-gap measures used instead of facing internal problems at the heart of currency weakness, critics said.

Others pointed out that swap arrangements, though somewhat outdated as floating currencies became widespread, at least promote closer working ties among central banks.

Swap lines "are a way of creating an illusion that the emperor has clothes," said Suhas Ketkar, senior economist and head of emerging markets analysis at Royal Bank of Scotland in New York. "When the crisis comes, they are not useful at all," he said.

Indeed, a basic swap agreement among several countries in the Association of Southeast Asian Nations was in place prior to the onset of the 1997 Asian financial crisis. This agreement was expanded and strengthened under the 2000 Chiang Mai Initiative, which Tuesday's meeting in Honolulu seeks to build on, said Michael Kurtz, Asian forex strategist at IDEAglobal in in New York.

The Chiang Mai Initiative was named after the Thai city that hosted last year's ADB meeting. The goal was to link the central banks of Japan, China and South Korea to those of the 10 ASEAN nations to provide a strong network of regional currency support.

In a recent report for the U.S.-ASEAN Business Council, Kurtz wrote that the limited size and vague lending conditions of the original ASEAN Swap agreement proved "completely ineffective in forestalling the fall of the [Thai] baht and subsequent Asian dominoes in 1997."

The new deal has the same inherent problems, Kurtz said, as protocol and conditions for extending reserve loans haven't been worked out.

In addition, Japan would become the major liquidity provider in the new deals. Kurtz noted that neighboring countries might be reluctant to take any accompanying advice or payback requirements from a nation often regarded as too dominant in the region.

And Japan has its own troubles with a declining yen, despite last week's gains on optimism over the new government.

"We still look at the yen as a source of instability in the region, which undermines regional currency stability," Kurtz said.

"The key issue is that [the swap agreement] is not addressing root causes of currency instability," which would require structural changes such as increasing transparency and bolstering banking systems, he said.

Add to that list the concerns of political instability and shrinking export markets, Ketkar said, and the issue becomes not so much an external attack on a currency but the country's own economic fundamentals.

Reminiscent Of A Bygone Era

A look at the Federal Reserve's phasing-out of currency-swap agreements suggests that such channels harken back to a time of fixed currencies, but fail to reflect the current market landscape.

Currency swap lines had a big role for the U.S. through the 1970s, when currencies severed links to the gold standard, and into the 1980s, when the U.S. frequently intervened in the foreign exchange market, said Scott Pardee, professor of monetary economics at Middlebury College in Vermont and a former Fed economist.

But as currencies floated and intervention became less frequent, the agreements fell into disuse, he said.

Until late 1998 and before the advent of the euro, the Fed had swap lines with 14 other central banks, including many of the major European central banks, and credit facilities totaled over $30 billion.

"The decision in 1998 was that they were no longer needed," Pardee said. "In the meantime, the U.S. had accumulated foreign currency balances."

Today, the Fed maintains only one tri-lateral swap line with the central banks of Canada and Mexico, with total facilities of $5 billion. The arrangement must be renewed every year.

The last draw on the U.S. reserves was during Mexico's currency crisis in 1995. But support for Mexico came mainly from a much larger International Monetary Fund package, Ketkar said, and the Fed's supplement was comparatively a drop in the bucket.

Thus the loans can be seen as a gesture of goodwill, analysts said, but are unlikely to mean much in the event of a major move against a currency.

The swap lines "Give a sense of substance, but if you're actually using these you can run through reserves pretty quickly," Pardee said.

And while a large swap line can act as a "deterrent" to speculators, a creditor bank can look askance at a borrower bank in a true time of need, said Larry Greenberg, chief economist at Ried, Thunberg and Co in Westport, Conn. and former Fed economist.

"It's not just cumbersome in the time it takes to call up the central bank to get permission, but you're also going to get yourself a lecture" from the central bank, he said.

But just having the deals in place implies a "closer working relationship" and "automatic communication" among central banks, which can only be healthy for nations' monetary policies, Pardee said.

(MORE) Dow Jones Newswires 05-08-01

1446EDT

Copyright (c) 2001 , Dow Jones & Company Inc

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Fallout from Malaysia's Big Bang

By Andrew Ho, AsiaWise

7 May 2001 10:30 (GMT +08:00)

The dust is finally starting to settle over Malaysia's new-look financial system, and investors would be wise to pay attention.

Thrown into desperate straits by the Asian financial crisis, the sector had to be bailed out by the government, which created an asset management company, Danaharta, and a special purpose bank recapitalization vehicle, Danamodal, to help the banking system in its moment of crisis.

These major developments were minor however, in comparison to the "Big Bang" -- the forced consolidation of every financial institution in Malaysia.

The country's 51 commercial banks, finance companies and merchant banks, were ordered to consolidate into 10 anchor bank groups by the end of last year, and all but one of them met the deadline.

Thanks largely to the swift action taken by the government, the gross non-performing loan ratio in the banking system now stands at 11.5%, down from the peak of 16% in 1998. The improvement in asset quality and high hopes for sector's performance post-consolidation helped banking stocks rebound spectacularly from their August 1998 trough -- the KLSE Finance Index gained more than 400% from August 1998 to February 2000.

That euphoria dissipated as the pace of consolidation slowed amidst disagreements over the valuation of merger partners, and gave way to skepticism when it became clear that the government frowned upon the retrenchment of staff. Investors also began to realize that the benefits of consolidation would be at least partially offset by merger expenses and bloated payrolls.

That skepticism remains. Deutsche Bank Equity Research's 2001 banking sector outlook points out that while the mergers succeeded in reducing the number of banks, they did nothing to improve systems and policies in order to ensure long-term profitability. The report also notes that valuations made some of the mergers look more like bailouts than transactions aimed at enhancing shareholder value. In fact, Deutsche Bank gave only two the thumbs up -- Public Bank Bhd and Hock Hua Bank Bhd and Commerce Asset Holdings Bhd (CAHB) and Bank Bumiputra Malaysia Bhd (BBMB).

While the commercial merits of the mergers are open to debate, it's certainly true that the benefits have yet to be reflected in the bottom line. Fourth quarter results at the top five banks were muted, with loan growth averaging 4%, only slightly above the 2% industry average.

That's hardly surprising given that management attention had been diverted as banks rushed to meet the December 31 deadline. Now that the deals are done it ought to take another 12-18 months before the full effects of integration and rationalization become clear.

As luck would have it, the 10 new banking groups face their first test just as they are getting started. Malaysia's slowing economy means the banks are now grappling with slower loan growth and the possibility of deteriorating asset quality. That is likely to prolong the post-merger 'recovery' and further delay any eventual benefits from the consolidation.

All of these factors have combined to earn the banking sector Neutral to Underperform ratings from most analysts. However, the top two banks, Maybank and CAHB, are starting to stand out from the crowd for more than their size.

Maybank, the granddaddy of Malaysian banks stands head and shoulders above the rest of the sector. Its total assets, 149 billion Malaysian ringgit, and net interest income, RM 929 million, in the fourth quarter of 2000 were almost double that of the next largest bank, CAHB. Maybank has always been the sector favorite, with strong asset quality (a gross NPL ratio of 11.5% and loan loss provision of 82% at the end of 2000) and a well-regarded management team.

Until a month ago, Maybank's share price had managed to defy gravity -- staying above RM 14.00 while the market fell 41% from its peak at the end of 1999. Since the middle of March, Maybank's price has corrected 34%, bringing the stock price in line with the rest of the market. At its current price of RM 9.60, the stock is trading at 1.7x price to book value (P/BV) and 15.2x price to earnings ratio (PER), down from 3.1x P/BV and 20.2x PER on FY01 earnings.

The sudden drop has been attributed to the U.S. slowdown and concerns over the ringgit peg which finally brought out the sellers, mostly foreign institutions. Local funds couldn't support the bank anymore so it finally broke through its support levels. The stock was also one of the few regional stocks that were in the money for mutual funds, so many may have had to liquidate to cover losses elsewhere.

Malaysia's number two bank, CAHB, vaulted from 'small time' bank to number two through its merger with BBMB. In what was probably the sweetest deal in town, CAHB acquired BBMB at 0.6x P/BV, along with the option to sell low-quality loans back to the government. (The current round of mergers valued banks at between 1.5x to 2.0x P/BV.)

In effect, CAHB got its hands on a huge retail franchise of over 250 branches and four million retail accounts -- along with a clean balance sheet. It also completed its merger a full year ahead of other banks and thus has a head start on its rivals.

Fundamentally, CAHB stands on firm ground with a gross NPL ratio of 7.9% and loan loss coverage of 60%. At RM 5.10, the stock is trading at 9.3x PER on FY01 earnings and P/BV of 1.0x.

The only kink in CAHB's armor is the share overhang from the potential sale of the bank by the Renong Group and the News Straits Times Press, which both hold 13% stakes in CAHB.

However, both parties are unlikely to dispose of their stake at current prices. Renong was looking to dispose of its holdings at RM 16.00 per share a year ago, but given current market conditions, a more realistic price would be between RM 10.00 to RM 13.00 per share -- and that's more than double CAHB's current share price.

In another sign that the two top banks are serious about remaining that way, both have announced plans to cut staff levels. Maybank has announced that it will pare down its staffing costs post-merger through a voluntary separation scheme offered to 1,500 employees and CAHB is taking steps to reduce its current staff to 7,700 from 9,700.