---

     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

             Monday, June 12, 2000, Vol. 3, No. 113

                                      Headlines


* A U S T R A L I A *

BHP: Court rejects unions' BHP strike appeal
DELTA GOLD: Takes a dive for closing Solomons mine
EDGE GROUP: Computer empire fails owing $40M
EISA: Must merge to survive, shareholders told
EISA: Negotiating with possible merger partners
MUSEUM OF CONTEMPORARY ART: Two-year closure threat  


* C H I N A  &  H O N G  K O N G *

FOUNDIN LTD: Facing winding up petition
GALLARIA INT'L LTD: Facing winding up petition
GLORY PROSPECT LTD: Facing winding up petition
HONG KONG TEXTILES EXCHANGE LTD: Facing winding up petition
JINANHUA PEARL JEWELRY CO.LTD.: Facing winding up petition
JUMBO PERFECT LTD: Facing winding up petition
KANSIN INVESTMENTS LTD: Facing winding up petition
PEACE RESTAURANT LTD: Facing winding up petition
TIMEFIT DEVELOPMENT LTD: Facing winding up petition


* I N D O N E S I A *

BANK OF BALI: Recapitalisation set to proceed this month
PT BIMANTARA CITRA: Suffers Rp58.2B loss
PT PERAWANG LUMBER INDUS.: To float shares,paydown debt


* J A P A N *

CREDIT LYONNAIS SECURITIES TOKYO: JSDA fines it 7M yen
BNP PARIBAS SECURITIES: Regulators punish Tokyo branch
KOFUKU BANK: 5 banks' capital deficit nearly 1.6T Yen
KOKUMIN BANK: 5 banks' capital deficit nearly 1.6T Yen
NAMIHAYA BANK: 5 banks' capital deficit nearly 1.6T Yen
NIIGATA CHUO BANK: 5 banks' capital deficit nearly 1.6T Yen
TAISEI CORP.: Plans 100B yen cut in interest-bearing debt
TOBISHIMA CORP.: Posts 22B yen group net loss  
TOKYO SOWA BANK: 5 banks' capital deficit nearly 1.6T Yen
TOKYO SOWA BANK: FRC to extend state control one year


* K O R E A *

DAEWOO MOTOR: Hyundai, DaimlerChrysler talk about joint bid
DAEWOO SECURITIES: Seeking to attract foreign capital
DONG AH GROUP: Clouds gathering over its future
KOREA MERCHANT BANKING CORP.: Hana Bank to bail it out


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

NATIONAL STEEL CORP.: PNB approves rehab plan
ORIENT BANK: PDIC files fraud cases vs bank officials
PHILIPPINE NAT.BANK: Gov't to sell 30% stake anyway
PHILIPPINE NAT.BANK: Extension of sale deadline sought
PHILLIPINE NAT.BANK: Tan interested in Gov't's stake
VICTORIAS MILLING CO.: Asks SEC to quash liquidation motion


* S I N G A P O R E *

CARREFOUR SINGAPORE: Trims S'pore loss; dismisses pull-out
IPC CORP.: Awaiting SGX approval of rehab plan
TRANSMARCO: Narrows annual loss


* T H A I L A N D *

BANGKOK STEEL INDUSTRY: Debt talks stall plans for merger
NTS STEEL PLC: Debt talks stall plans for merger
SIAM CITY CEMENT: To merge two units before IPO


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

BHP: Court rejects unions' BHP strike appeal
--------------------------------------------
BHP says a Federal Court ruling will allow the company to
get on with its iron ore business in the Pilbara while
preparing for a future legal showdown with unions over
workplace agreements.

The court has dismissed an appeal by unions to overturn an
injunction which stopped a 24-hour strike at BHP's Newman
and Port Hedland sites.  But a full hearing will be held
later this month to determine if BHP's move to establish
individual contracts with its workers is lawful.

BHP's Graeme Hunt says he is glad the strike has been
averted but it would not have changed the company's offer
for a collective workplace system as an alternative to
individual contracts.

"It would have caused us some inconvenience," he said.
"We would have still been able to operate, albeit at some
reduced level, but it's really not going to change. The
strikes wouldn't have changed our position with respect to
the type of collective which is acceptable to us."  (ABC
News Online  09-Jun-2000)

DELTA GOLD: Takes a dive for closing Solomons mine
--------------------------------------------------
Delta Gold's forced closure of its Gold Ridge gold mine on
Guadalcanal in the Solomon Islands has cost the Sydney-
based company dearly in terms of its market capitalisation.

Delta's share price dived 22 cents, or 15.5 per cent, to
$1.20 yesterday, with institutional support for the stock
vanishing after news that operations at Gold Ridge had been
suspended.  The group secured control of Gold Ridge only
this year with the $107 million paper-only takeover bid for
the Brisbane-based Ross Mining.

From the time the bid was announced up until close of trade
yesterday, Delta has lost $258 million in market value. The
market now values the group at $316 million.  That
depressed level exposes it to an opportunistic share raid,
although continued uncertainty about the future of Gold
Ridge will scare off most predators.

Analysts said yesterday that the sell-down in Delta shares
had probably been overdone. The crunch in the share price
has nevertheless been real enough.  Gold Ridge was
developed by Ross Mining at a cost of $65 million. It was
the first mine development in the country and, when in
production, would account for up to 30 per cent of the
Solomon Islands' gross domestic product.

March-quarter production at Gold Ridge was 33,575 ounces at
a production cost of $336 an ounce.  Delta said on Thursday
it would review the status of Gold Ridge as "circumstances
evolve", and that it intended to reopen the operation once
it was able to ensure the safety of its staff. (The Age  
10-Jun-2000)

EDGE GROUP: Computer empire fails owing $40M
--------------------------------------------
The Australian business empire of computer entrepreneur Mr
Johnson Wang has collapsed, owing about $40 million to
creditors, including an estimated $17 million to Microsoft.

Mr Wang, who is the controlling shareholder in cash-starved
internet service provider eisa Ltd, appointed an
administrator, Mr Andrew Wily of Armstrong Wily & Co, to
his Edge group of companies on Thursday.  However, a
secured creditor owed $1 million, Cash Resources Australia,
then appointed a receiver, Mr Chris Wykes of Lawler
Partners.

The Edge group of companies was one of Australia's largest
sellers of personal computers with sales of$250 million in
1998, but sales slumped to less than $50 million in the
nine months to March.  The collapse of Mr Wang's private
business interests comes as eisa, which has been suspended
from trading on the stock exchange for a week, searches
desperately for a rescue partner.  None of the companies in
receivership owns shares in eisa.

As recently as two weeks ago, eisa managing director Mr
Damien Brady said he was confident the company would pull
off the purchase of internet service provider OzEmail for
more than $300 million.  The deal fell through after John
Fairfax Holdings' internet arm, f2, scrapped a planned $40
million investment in the deal. Soon after, ANZ Banking
Group, Hastings Fund Management and Disney Go Network
withdrew from the deal.

eisa shareholders meet in Sydney today for an extraordinary
general meeting that was originally called to approve the
OzEmail deal and appoint several directors. It is not clear
what will be on the agenda today.  eisa told the stock
exchange yesterday it did not have an investment in Edge
and was not responsible for the debts of any Edge company.
Mr Wang, who once boasted a computer sales business in 10
countries with annual revenue of $1 billion, will not
attend the eisa meeting as he flew out of the country on
Thursday soon after signing the documents appointing Mr
Wily as administrator.

"Now that the receivers have been appointed, we will be
left with whatever is left," Mr Wily said.

He said Armstrong Wily & Co had not had any relationship
with Mr Wang or his companies before his appointment. The
receiver, Mr Chris Wykes, is in charge of the following
companies: Edge Holdings Pty Ltd, KTX Holdings Pty Ltd,
Edge Computers Pty Ltd, Edge Technologies Pty Ltd and Edge
Properties Pty Ltd.

Mr Wykes said the secured creditor, Cash Resources, had
provided a factoring facility to the Edge group of
companies in February.  It had bought the Edge group's
invoice book to provide emergency funding.  He said the
unsecured creditors were owed about $20 million, and that
did not include a contingent liability to Microsoft that
related to a royalty dispute dating back many years.

Microsoft took Federal Court action against Edge in July
1999 over its alleged failure to pay royalties. Mr Wykes
said the Edge group had suffered substantial losses in the
nine months to March after its sales of personal computers
collapsed.

"The sales fell off the planet," he said.

He said the company's stock, plant and equipment were
valued yesterday.  A director of the Edge group of
companies, Ms Delphie Wang, was at the company's premises
in Alexandria yesterday. (Australian Financial Review  09-
Jun-2000)

EISA: Must merge to survive, shareholders told
----------------------------------------------
The future of teetering Internet service provider eisa
depends on a merger with another company, eisa chairman Mr
Evan Rees told shareholders this morning.

"We now believe the future of eisa lies with the company
merging with another company," Mr Rees said at the
company's first annual general meeting in Sydney today.
"I know the share price is not too good, but you have some
very good people in the management team, including those on
the rostrum, who are working hard to get the best outcome
for you."

eisa, which provides Internet access to about 85,000
residential customers, is struggling for survival after the
collapse of its proposed $325 million purchase of OzEmail
from US phone giant WorldCom.  The AGM began at 10.30am and
lasted only 20 minutes before managing director Mr Damien
Brady and the four other directors hurried away from the
building. eisa's biggest shareholder, Mr Johnson Wang, was
not in attendance.

Mr Wang was in Sydney earlier this week to meet with a
volunatry administrator following the collapse of his
personal computer empire, the Edge group.  Eisa's chairman
Mr Evan Rees did not mention Edge at the meeting, other
than to apologise for Mr Wang's absence.  Edge is not a
shareholder of eisa, but owes money to the Internet service
provider.

eisa's young chief executive Mr Damien Brady only spoke
twice at the meeting, first to greet the audience and then
later to provide support from chairman Mr Rees, when a
shareholder questioned why he should be elected to the
post.  Mr Brady said Mr Rees had been a director of the
company since its foundation and had acted in the company's
best interests during the attempted takeover of Ozemail.

Mr Rees took over as chairman last week after former
chairman Mr John Pascoe resigned citing health problems.
eisa is believed to have little cash left and is attempting
to retrieve a $20 million deposit it had paid to as a
downpayment for OzEmail.  Mr Rees said this was a legal
matter'' and declined to comment further.

He described the proposed OzEmail purchase as "a highly
complex and involvced plan" involving many elements,
including investments by Fairfax, ANZ and Hastings Funds
Management.  "To our great disappointment, these elements
didn't come together."

After the meeting, a shareholder who did not want to be
named, said he was disappointed at the meeting's outcome.

"I don't like the way shareholders have been treated here,"
he said. "Most people came here to ask questions about the
company's future.  They [the eisa directors] just stormed
off without any explanation. We were hoping to get an
explanation about how long the company can last, not some
blithe statement."

The shareholder said he had bought 1000 shares in eisa at
72c. The company's shareprice was suspended earlier this
week at 24.5c.  (Sydney Morning Herald  09-Jun-2000)

EISA: Negotiating with possible merger partners
-----------------------------------------------
Teetering Internet service provider Eisa is negotiating
with four possible merger partners, managing director Mr
Damien Brady said following the company's first annual
general meeting in Sydney yesterday.

Eisa chairman Mr Evan Rees was at times hesitant as he
assured shareholders during the 20-minute AGM that the
company was in no danger of folding, despite its
dangerously low cash reserves.

"We now believe the future of eisa lies with the company
merging with another company. I know the share price is not
too good, but you have some very good people in the
management team, including those on the rostrum, who are
working hard to get the best outcome for you," he said.

Mr Brady later said eisa was negotiating with four possible
suitors and expected to make an announcement within "a very
short time frame. There's enormous interest from a whole
range of companies," he said.

Eisa, which provides Internet access to about 85,000
residential customers, is struggling for survival after the
collapse two weeks ago of its proposed $325 million
purchase of OzEmail from US phone giant WorldCom. Only four
months ago, on February 11, Eisa announced it had trumped
Telstra and had plonked down $20 million as a downpayment
on OzEmail.  The deal - which brought together partners
Fairfax, ANZ, Disney and Hastings Funds Management - was
hailed as a David and Goliath style triumph at the time.

Happy shareholders watched as eisa's share price spiralled
upwards, touching $3.18 on February 18. It was especially
gratifying for those who had paid $1 per share in eisa's
$57 million float last August - only to watch the share
price spend most of last year wavering between 70c and 80c.
Their joy did not last. The deal came under pressure
following the deflation of the Internet sharemarket bubble
on April 17, which smacked eisa's share price back down to
93c.

On May 30, Fairfax pulled out. Eisa is understood to have
considered replacing Fairfax with Publishing & Broadcasting
or News Corp. But, on June 1, WorldCom pulled the plug
before a replacement could be cemented.

Eisa's shareholders stampeded for the exit. Some 25 million
shares changed hands that day, sending the share price as
low as 22.5c. It rose slightly to 24.5c, where it has
remained since trade of the shares was suspended, pending
an announcement that has yet to come.  Eisa - which employs
about 200 staff - had enough funds to survive until a
merger had been negotiated, Mr Brady said.

The group is still consulting legal advisers in a bid to
have its $20 million deposit returned by WorldCom. Mr
Brady, who faced claims in the press about the quality of
his credentials, said he was heartened by his re-election
as managing director.  Eisa's major shareholder, Mr Johnson
Wang, was not in attendance.

Mr Wang was in Sydney earlier this week to meet with a
voluntary administrator following the collapse of his
personal computer empire, the Edge group.  Edge was not a
shareholder of eisa, but owed several hundred thousand
dollars to eisa, Mr Brady said. (Sydney Morning Herald  10-
Jun-2000)

MUSEUM OF CONTEMPORARY ART: Two-year closure threat  
---------------------------------------------------
The Museum of Contemporary Art could be closed for two
years under the Lord Mayor's plan to save the institution.

The temporary closure would allow capital works to be
carried out, according to Sydney City Council's general
manager, Mr Greg Maddock.

"We've looked at the option of closure, we've looked at the
option of putting exhibitions somewhere else, we've looked
at the option of keeping it open," he said.

He declined to put a time-frame on any closure, but several
sources indicated two years was likely.  "It depends a bit
on what style of construction you do," Mr Maddock said.
"There's a range of options as to how long it would be
closed for ... anyone would be guessing at the moment."

Details would not be known until the memorandum of
understanding was signed with the State Government, he
said.  What would happen to the museum, its staff or
collection during any closure had not been decided. Any
closure would have to be discussed with the museum's board.

"It depends on what level of building and how you time it
and stage it. You'd keep it to as small a time as
possible."

A spokeswoman for the Premier said yesterday the memorandum
had yet to be signed.  Mr Carr told a Budget Estimates
Committee this week that he was close to concluding a
memorandum of understanding with the Lord Mayor, Councillor
Sartor, over the MCA's future.  The Lord Mayor outlined
three options for the MCA earlier this year. These are
believed to include an extra floor on the top, renovating
the museum's difficult entrance foyer and the creation of a
cinema complex. (Sydney Morning Herald  10-Jun-2000)


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

FOUNDIN 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
Pimenta Company Limited for the winding up of Foundin
Limited.  A notice of legal appearance must be filed on or
before July 11.

GALLARIA INT'L LTD: Facing winding up petition
----------------------------------------------
The High Court of Hong Kong SAR, Court of First Instance,
has scheduled a hearing for July 19 on the petition of
Zeyko GmbH Kopp + Zeyher iK for the winding up of Gallaria
International Limited.  A notice of legal appearance must
be filed on or before July 18.

GLORY PROSPECT 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 Nice
Holdings Limited for the winding up of Glory Prospect
Limited.  A notice of legal appearance must be filed on or
before July 11.

HONG KONG TEXTILES EXCHANGE 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
Elitak Industrial Corporation Limited for the winding up of
Hong Kong Textiles Exchange Limited.  A notice of legal
appearance must be filed on or before July 11.

JINANHUA PEARL JEWELRY CO.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
China State Bank Limited for the winding up of Jinanhua
Pearl Jewelry Company Limited.  A notice of legal
appearance must be filed on or before June 27.

JUMBO PERFECT 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 Ho
Hoi Lunof for the winding up of Jumbo Perfect Limited.  A
notice of legal appearance must be filed on or before July
11.

KANSIN INVESTMENTS 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
Ferro Far East Limited for the winding up of Kansin
Investments Limited.  A notice of legal appearance must be
filed on or before July 11.

PEACE RESTAURANT 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
Ching Wan for the winding up of Peace Restaurant Limited.  
A notice of legal appearance must be filed on or before
July 11.

TIMEFIT DEVELOPMENT 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 Lam
Kin Chung for the winding up of Timefit Development
Limited.  A notice of legal appearance must be filed on or
before July 4.


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

BANK OF BALI: Recapitalisation set to proceed this month
--------------------------------------------------------
Indonesia will recapitalise Bank Bali this month despite a
legal dispute between the government and the founding
family of the bank.

The announcement yesterday by the government's Financial
Sector Committee was greeted positively by Herman Ramli,
son of bank founder Djaja Ramli and younger brother of the
bank's former president director Rudy Ramli. The committee
is chaired by chief Economics Minister Kwik Kian Gie.
Members include the finance minister and the powerful
Indonesian Bank Restructuring Agency (IBRA).

Bank Bali, which is at the centre of a politically charged
scandal, is currently under the control of Ibra.  The bank
needs about 4.8 trillion rupiah (S$955 million) to
recapitalise, but that effort has been stalled by a legal
battle between Indonesian financial authorities and Rudy
Ramli, who has objected to the government takeover of the
institution.

"Ibra is expected to take care of the legal process with
Rudy Ramli and the recapitalisation must also be done by
the end of June," said Safrudin Tumenggung, secretary of
the government's Financial Sector Committee.

Herman Ramli said: "I agree with the decision by the
government's Financial Sector Committee to recapitalise the
bank. Negotiations between my elder brother and Ibra are
still going on. Both are on the right track."

Bank Bali is at the centre of a scandal that helped scupper
former president B J Habibie's chances of re-election last
October and which on Monday implicated central bank
governor Sjahril Sabirin. The scandal erupted almost a year
ago and revolves around a huge loan collection fee the bank
paid to a firm close to the then ruling Golkar party.

On Monday, Mr Sabirin was officially named a suspect in the
scandal and analysts said this had added to concerns over
political uncertainty in Indonesia.  Bank Bali shares
closed at 350 rupiah yesterday, up 25 rupiah.   (Reuters,
Business Times  09-Jun-2000)

PT BIMANTARA CITRA: Suffers Rp58.2B loss
----------------------------------------
Listed holding company PT Bimantara Citra said on Wednesday
it had suffered a consolidated net loss of Rp 58.2 billion
in the first quarter of this year, as compared to a net
loss of Rp 133.7 billion in the same period last year.

The company attributed the loss to large foreign
exchange losses, which were mostly contributed to by the
holding's telecommunications units PT Elektrindo Nusantara
and PT Komselindo.  Total foreign exchange losses reached
Rp 82 billion in the first quarter of this year, as
compared to Rp 99 billion in the same period in 1999.
Sales revenue in the first quarter rose to Rp 424.8
billion, from Rp 333 billion in the previous year.
Operating profit also increased to Rp 71.1 billion
from Rp 31.7 billion. Bimantara Citra president Joseph
Dharmabrata said the company was still negotiating a
US$39.6 million debt restructuring agreement with its
creditors.

"The Indonesian Bank Restructuring Agency (IBRA) represents
some $24 million of the above debts," Joseph said,
adding that Bimantara planned to sign a memorandum of
understanding on debt restructuring with IBRA on June 30.
Joseph declined to disclose Bimantara's current proposal on
debt restructuring to its creditors, but said a debt-to-
equity-swap-scheme was unlikely. "Things are still
tentative, we won't say anything about the details of our
proposed debt restructuring to the creditors," he said.

But Bimantara will sell its non-core business units
to focus on the telecommunications, automotive and
broadcasting business units, he said. "The sale of those
assets will be in the coming months," he said. Bimantara
Citra, which is controlled by former president Soeharto's
son Bambang Trihatmodjo, currently operates in the
media, broadcasting, telecommunications, infrastructure,
transportation, property and financial services businesses.
(Jakarta Post  08-Jun-2000)

PT PERAWANG LUMBER INDUS.: To float shares,paydown debt
-------------------------------------------------------
Plywood producer PT Perawang Lumber Industri plans to sell
about 180 million new shares or about 20 percent of its
enlarged stocks next month to repay debts of Rp 64 billion.
The company said on Thursday it expected to raise about Rp
90 billion (US$10.58 million) from the initial public
offering (IPO).

"Rp 46 billion of the total IPO proceeds will be used to
repay debts to the plywood producer's sister company PT
Perawang Perkasa Industri," the company said, adding that
the remaining 18 billion will repay debts to state Bank
Mandiri.

The remaining IPO proceeds will be used to finance a new
lumber plant and to increase its stake in its affiliate, PT
Wiras Perdana Lines, the company said.   Listed PT Trimegah
Securities has been appointed as the underwriter for the
IPO. The new shares, with a par value of Rp 500, will be
sold at between Rp 500 and Rp 650 during the offering
period between July 10 and July 12.

Akhabani, head of investment banking at Trimegah
Securities, said the Perawang Lumber shares would be listed
on the Jakarta Stock Exchange after the public offering was
completed.   He said he was optimistic the market would
respond well to the IPO given the company's bright
prospects.

But Lukman Hakim of Ludlow Securities said Perawang
Lumber's shares were not so attractive because the largest
portion of the IPO's proceeds would be used to repay debts,
not to fund business expansion.

The company's IPO will reduce the ownership of the company
to 80 percent, from 99.5 percent.  The company also said it
would give seven warrants for every 10 shares as a
sweetener to attract investors, which would be convertible
to common shares within eight months of the IPO.

Perawang Lumber produces 156,000 cubic meters of plywood,
48,000 cubic meters of coated plywood and 51,000 cubic
meters of particle board per year.  It booked a net income
of Rp 20.5 billion on net revenues of Rp 348.2 billion in
1999, compared to Rp 6.7 billion and Rp 310.9 billion the
previous year.

Currently, 91 percent of the company's output is for the
export market, such as Japan, South Korea, Hong Kong,
Taiwan, European and Middle Eastern countries.  Perawang
Lumber is 99.5 percent owned by listed forestry concern PT
Surya Dumai. The parent company posted a negative income of
Rp 53.2 billion in 1999 and posted total debts of Rp 1.5
trillion as of the end of 1999.  (Jakarta Post  09-Jun-
2000)


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

BNP PARIBAS SECURITIES: Regulators punish Tokyo branch
------------------------------------------------------
Financial regulators have announced penalties on the Tokyo
branch of BNP Paribas Securities after it broke laws by
helping clients avoid losses.

It was also ordered to halt stock broking for three days.
The Financial Supervisory Agency (FSA) ordered the branch,
a unit of Paris-based BNP Paribas, to also suspend
operations in its product development and stock derivatives
departments for a week.

"We take the penalty seriously. We will improve our
operations to avoid any such [penalties] in the future," a
spokesman for the Tokyo unit said.

The penalties come into effect on Wednesday and follow a
recommendation made last month by Japan's securities
watchdog, the Securities and Exchange Surveillance
Commission (SESC), which urged the action after inspecting
BNP Paribas' Tokyo operations.  The SESC said the branch
illegally helped three corporate clients avoid 9.5 billion
yen (about HK$699.2 million) in derivatives trade losses
between September 1997 and July 1998.

It declined to name the one financial and two non-financial
firms, but said they eventually booked the losses.
Regulators are increasingly keen to show they are taking a
tough line against foreign and domestic financial
institutions to improve standards.

Since the FSA was formed as a separate body from the
Ministry of Finance in 1998, it has suspended or partly
barred nine foreign banks from some of their operations for
violations found during regular audits. The authorities
have said they plan to audit all foreign securities firms
within two years.

"As an investor, these punishments in Japan don't
particularly bother me since everyone seems to be getting
it," said Francine Le Callo of Fortis Asset Management in
Paris.

The FSA last month announced wide-ranging penalties against
Deutsche Securities, barring the unit of Deutsche Bank from
applying to conduct over-the-counter derivatives trade for
six months for illegally selling products to help clients
hide losses.  That was one of the most severe penalties
ever imposed on a foreign financial institution by the
regulators.

The Ministry of Finance also said it would suspend the BNP
Paribas branch from underwriting Japanese Government bonds
or taking part in government bond auctions between June 14
and June 20. The branch's share of underwriting at the last
auction was 0.0616 per cent of the total, it said.

The SESC said its inspection found the branch illegally
helped clients avoid big trading losses, paid rebates
disguised as advisory fees and conducted discretionary
trades.  The branch has also been accused of illegally
paying 1.2 billion yen in rebates to three Japanese
investment advisory firms between April 1994 and January
1996 and labelling the payments as advisory fees.

The SESC also accused Paribas of illegally entering into
discretionary trading contracts on behalf of 17 clients
between December last year and February.  Under Japanese
law, a broker must have a client's specific approval for
which issues to buy and sell and at what price.  (South
China Morning Post  10-Jun-2000)

CREDIT LYONNAIS SECURITIES TOKYO: JSDA fines it 7M yen
------------------------------------------------------
The Japan Securities Dealers Association has imposed a 7
million yen fine on the Tokyo branch of Credit Lyonnais
Securities Europe-Switzerland AG.

Additioanlly, the JSDA admonished the branch to improve its
internal controls and management so as to ensure that it
would not violate securities laws again.

The move Thursday was in response to the Financial
Supervisory Agency's imposition last month of a partial
business ban on the branch. The FSA had determined that the
branch had given clients false reports, violating the
Securities and Exchange Law in the process.

KOFUKU BANK: 5 banks' capital deficit nearly 1.6T Yen
KOKUMIN BANK: 5 banks' capital deficit nearly 1.6T Yen
NAMIHAYA BANK: 5 banks' capital deficit nearly 1.6T Yen
NIIGATA CHUO BANK: 5 banks' capital deficit nearly 1.6T Yen
TOKYO SOWA BANK: 5 banks' capital deficit nearly 1.6T Yen
-----------------------------------------------------------
Five failed Japanese regional banks now under control of
government-appointed bankruptcy administrators had 1,576.8
billion yen in total capital deficit on March 31, up from
1,175.3 billion yen six months earlier.

The five banks are Kokumin Bank, Kofuku Bank, Tokyo Sowa
Bank, Namihaya Bank and Niigata Chuo Bank. Buyers of two of
the banks, Tokyo Sowa and Niigata Chuo, have yet to be
chosen, and the delay in finding their successors would
worsen the two banks' capital deficit.

Outstanding deposits of the five banks totaled 3,787.3
billion yen, nearly half their level of a year ago. Kokumin
lost about 60 pct of its deposit holdings.  The banks'
outstanding bad loans came to 2,549.1 billion yen,
accounting for about half of their total outstanding loans.

The Financial Reconstruction Commission has approved the
sale of Kokumin to Yachiyo Bank, Kofuku to WL Ross and Co.,
a U.S. investment company, and Namihaya to the Daiwa Bank
group.  WL Loss is regarded as a leading candidate to
acquire Tokyo Sowa, while several financial institutions,
including Taiko Bank, are likely take over parts of Niigata
Chuo, whose operations are expected to be broken up.  (Jiji
Press English News Service  09-Jun-2000)

TAISEI CORP.: Plans 100B yen cut in interest-bearing debt
---------------------------------------------------------
Taisei Corp. plans to cut its consolidated interest-bearing
debt by 100 billion yen to 860 billion yen this fiscal
year, utilizing the sale of its less-profitable real estate
and securities.

The firm is speeding up its timetable, originally planning
to get its interest-bearing liabilities below 900 million
yen by the end of fiscal year 2001. Instead, it has moved
the plan ahead one year. Part of the reason, no doubt, was
the company's succes in fiscal year 1999, when Taisei
reduced its group interest-bearing liabilities by 300
billion yen.

The parent company's portion of the total debt to be
reduced amounts to 45 billion yen, with the rest to be
trimmed by domestic and foreign subsidiaries.

TOBISHIMA CORP.: Posts 22B yen group net loss  
---------------------------------------------
Tobishima Corp. posted a consolidated net loss of 22.1
billion yen for the fiscal year ended March, compared with
a profit of 347 million yen the prior year.

The Japanese general contractor attributed its poor
performance to a special loss totaling nearly 29.4 billion
yen, which included 11.27 billion yen as a loan-loss
reserve, 8.38 billion yen for an appraisal loss of its
securities holdings, and 8.39 billion yen for the appraisal
loss of its real estate holdings.

The company's consolidated operating profit for the year-
ended dropped 15 percent from a year earlier to 12.64
billion yen. The contractor had group sales of 315.65
billion yen, down again from the prior year by 7.9 percent.
Group pretax profit fell 29.2 percent to 4.8 billion yen.

Masatoshi Yamamoto, director of Tobishima, said the company
had decided to record the special items in the last fiscal
year in anticipation of the implementation of even stricter
accounting standards this fiscal year.  

On a positive note, Tobishima cut its consolidated
interest-bearing liabilities by 19 percent in the year to
152.1 billion yen. It anticipates a further cut of the
debts by about 10 billion yen this year.  For this fiscal
year, Tobishima projects a consolidated net profit of 250
million yen and an operating profit of 12.1 billion yen on
sales of 330 billion yen.

TOKYO SOWA BANK: FRC to extend state control one year
-----------------------------------------------------
The Financial Reconstruction Commission will extend state
control of Tokyo Sowa Bank for one year to allow the best
institution possible to be found to take over the failed
bank's operations.
Financial rehabilitation law provides that bank operations
must be transferred within 12 months, though control may be
extended if a proper purchaser is not found.  Selection of
a purchaser was supposed to have been completed by the end
of June, but the FRC has decide no qualified institution
has been found, necessitating the extension.


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

DAEWOO MOTOR: Hyundai, DaimlerChrysler talk about joint bid
-----------------------------------------------------------
Hyundai Motor Co. said it has made "considerable progress"
in talks with Germany's DaimlerChrysler AG about making a
joint bid for near-insolvent Daewoo Motor Co.

"Things are going well," Hyundai Motor Chairman Chung Mong
Koo told reporters after arriving in Seoul from a trip
abroad, according to Hyundai spokeswoman Jeong Seung-Mihn.

DaimlerChrysler is considering a joint bid, though no
agreement has been made yet, Chung said. DaimlerChrysler
declined to comment.  By pairing up with DaimlerChrysler,
Hyundai Motor may overcome the Korean government's
opposition to Daewoo Motor being swallowed by its bigger
rival.  Hyundai already controls almost three-quarters of
car sales in Asia's second-biggest market.

"If Hyundai needs a little help in buying Daewoo,
DaimlerChrysler has a lot of cash right now," said James
Collins, an analyst at Donaldson Lufkin Jenrette.

A tie-up between Hyundai and the German automaker would be
a blow for General Motors Corp., Ford Motor Co. and Fiat
SpA, which may also bid for Daewoo. The auction of Korea's
second-biggest automaker will give the winner access to one
of the region's most closed car markets.  The potential
bidders are halfway into a two-week period of scrutiny of
Daewoo Motor's business before they decide whether to
proceed with formal bids next month.  (The Detroit News
09-Jun-2000)

DAEWOO SECURITIES: Seeking to attract foreign capital
-----------------------------------------------------
Daewoo Securities Co. yesterday announced it will seek to
attract foreign capital between August and September this
year through either sale of stakes or a rights issue.

President & CEO of Daewoo Securities Park Jong-soo
confirmed that state-run Korea Development Bank (KDB),
which took over the brokerage house last month, is studying
measures to introduce foreign investment via the sale of a
20.5-percent stake held by Daewoo's creditor banks or
new share issues.

"More weights are placed on sale of stakes," he added.
Daewoo Securities is also considering strengthening ties
with KDB to sell bonds issued by the bank at Daewoo
branches. Expecting commission income to fall due to
upsurge in online stock trading, we will reinforce the
asset-management business, while expanding investment-bank
operations," the CEO said.

He added that the brokerage house will accelerate the
planned sale of its assets. (The Korea Herald  09-Jun-2000)

DONG AH GROUP: Clouds gathering over its future
-----------------------------------------------
Dark clouds are gathering over the future of the troubled
Dong Ah Group following the surprise dismissal of six top
managers, including Chairman Koh Byung-woo.

Dong Ah creditor's discharge of the top executives has
dealt a heavy blow to the construction giant which has been
torn by an internal row over managerial hegemony.  The
managerial crisis of Dong Ah, the first conglomerate put
under a debt workout program in 1998, has raised concerns
among other workout firms that are managed, like Dong Ah,
by professional managers brought in from outside.

Koh, previously chairman of the Korea Stock Exchange and
minister of construction and transportation, took the helm
of Dong Ah in September 1998 as the first professional
manager to run a chaebol company put under a workout
program. He earned the disgrace of becoming the first
creditor-appointed professional manager to be dismissed for
managerial failures.

By the request of creditors, Koh took over the chairmanship
of the family-controlled Dong Ah after his predecessor,
Choi Won-suk, stepped down in May 1998 after creditor banks
saved the company from bankruptcy with emergency rescue
loans.  Dong Ah was hit harder by the yet-to-be confirmed
allegations that the company amassed slush funds to donate
political funds to politicians ahead of the April 13
general elections.

Also, the dismissal of top executives has also raised
concerns among Dong Ah employees about the possibility of a
managerial vacuum, as seen in 1998 after Choi retired from
his office, until the creditor bank-controlled
stockholders' meeting will convene late next month to
appoint Koh's successor although Dong Ah creditors said
they will prevent the troubled group from drifting by
naming an acting chairman.

All these developments have thrown cold water on the future
course of Dong Ah's half-baked debt workout program because
they were coupled with the most serious row the company has
ever experienced following the power struggle between
followers of the outgoing Koh and Lee Chang-bok, now ex-
president of Dong Ah.

A ranking Dong Ah official said that an added concern is
that the dispute over managerial control has only left the
Dong Ah Group serious discord among company staff, raising
questions about the possibility of the ill-fated company
soon pulling itself together again.

In fact, the ill-fated outgoing Koh indicated as he stepped
down that allegations of lobbying politicians against him
might have disgracefully come from insiders in his
opposition, casting another cloud over the future course of
Dong Ah, which was once described as one of the promising
companies likely to graduate from the workout program. (The
Korea Herald  09-Jun-2000)

KOREA MERCHANT BANKING CORP.: Hana Bank to bail it out
------------------------------------------------------
Accepting a government bailout package for Korea Merchant
Banking Corp. (KMBC), Hana Bank, KMBC's largest shareholder
has decided to help put the troubled merchant bank back on
track.

"We decided to accept the government aid package because of
its promise to solve KMBC's call loan of 190 billion won
involving Nara Merchant Banking Corp. at the earliest date
possible," a Hana official said yesterday.

However, if the government fails to abide by its promise
later, it will be impossible for Hana Bank to provide
additional financial aid to KMBC and take charge of the
troubled merchant bank, he stressed.  Late last month,
Hana, which has a 22.5 percent stake in KMBC, provided an
emergency loan of 85 billion won to the ailing merchant
bank to help it pull out of a liquidity crunch.

One of the top three industry leaders, KMBC is now in a
serious financial crunch as a result of providing call
money worth 190 billion won to the failed Daewoo Group
through Nara. In return for the loan, KMBC has received
Nara's long overdue commercial notes. Nara had its business
license revoked due to problems involving call loans worth
1.7 trillion won extended to Daewoo.

Concerning the issue, an official at the Ministry of
Finance and Economy said yesterday that the deposit
insurance agency may repay Nara's commercial notes held by
KMBC in place of Nara.

He also said the government will support Hana Bank by
either helping it make a capital raise or extending
financial aid because the bank is determined to revive the
troubled KMBC.

Unveiling the aid package for KMBC Thursday, the government
said the Korea Deposit Insurance Corp. (KDIC) will purchase
KMBC's subordinated bonds worth 188 billion won. The state-
run deposit insurance agency will also pay off debts of
94.8 billion won which Hanarum, another merchant bank owes
to KMBC.

Meanwhile, the KDIC said yesterday that it has declared
KMBC as a financial institution feared to become insolvent
in the wake of the bailout package.  Under the law on
protection of depositors, the steering committee of the
state agency is entitled to designate a financial
institution as potentially insolvent in return for
financial aid.

KMBC is the latest of merchant banks hit hard by their
exposure to the dismantled Daewoo Group. Last month, the
Financial Supervisory Commission halted the business of
Yeungnam Merchant Banking as it became insolvent due to a
loan to Daewoo. (The Korea Herald  10-Jun-2000)


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

NATIONAL STEEL CORP.: PNB approves rehab plan
---------------------------------------------
The Board of Philippine National Bank has approved the
proposed rehabilitation plan for National Steel Corp. which
was submitted to the Securities and Exchange Commission
last month by the steel firm's interim rehabilitation
receiver.

Sources said PNB's approval of the plan has improved the
prospects of getting the rehabilitation program also
approved by the SEC since the bank is NSC's biggest
creditor. Out of NSC's P16.5-billion debt, PNB accounts for
about P5 billion.

"I have been receiving encouraging results (on the proposed
rehabilitation plan)," said SEC Associate Commissioner
Danilo Concepcion, who chairs the SEC panel hearing the NSC
case.

Concepcion said that on top of PNB, four other creditors of
the steel firm have formally expressed support to the
rehabilitation plan.  Last month, the NSC interim
rehabilitation receiver led by former associate
commissioner Monico Jacob submitted to the SEC a detailed
rehabilitation plan proposing that P9 billion of the steel
firm's P16.5 billion in debts be restructured while the
balance be converted into equity.

The plan also called for the entry of a strategic investor
that would infuse additional capital of $600 million to $1
billion into NSC; the writing down of selected assets, and
the financing of capital expenditures through long-term
debts.

The rehabilitation plan also calls for the government's
participation. This is to address anti-dumping concerns on
imported steel products that aggravated the situation of
NSC, the disposal of big-ticket real estate assets, the
forging of a long-term supply contract with a slab producer
to ensure steady supply of raw materials, and the
implementation of a comprehensive maintenance program.

NSC is the country's leading manufacturer of steel
products. It, however, encountered liquidity problems due
to huge foreign currency-denominated debt that ballooned
during the Asian financial crisis. Its sorry state was
further compounded by the influx of cheap imported steel
products arising from the country's trade liberalization
policy.

Late last year, the SEC granted the steel firm's petition
for suspension of debt payments, after which the regulatory
agency assigned a three-member interim receiver committee
led by former SEC commissioner Monico Jacob. Other members
of the committee are former National Power Corp. president
Guido Delgado and former Science and Technology Secretary
Dr. Antonio Arizabal.

The IRC was given the principal task of conserving NSC's
assets, determining the viability of the business and, if
viability was established, initiating a rehabilitation plan
(Philippine Daily Inquirer  10-Jun-2000)

ORIENT BANK: PDIC files fraud cases vs bank officials
-----------------------------------------------------
The Philippine Depositors Insurance Corporation (PDIC)
filed estafa charges against high-ranking officials of
Orient Bank, believing the issuance of fake loans prompted
the closure of the bank.

PDIC filed 24 counts of estafa charges to the Department of
Justice (DOJ) as PDIC believed the issuance of fake loans
prompted the closure of Orient Bank.  In the 48-page
complaint affidavit filed by Honorio Franco, deputy
liquidator of Orient Bank, ten high-ranking officals
allegedly issued cheques to different companies amounting
to P178.6 million to cover up their respective debts.

Allegedly corrupt officials include Jose Go, Aida dela
Rosa, Richard Su, Felicitas Necomedes, Elizabeth
Gorbinitez, Veronica Zamora, Cristina Lorelai Buellas,
Edmundo Martinez, Antonio Aragon and Conchita Emelo.

PDIC, however, requested assistant chief state prosecutor
Leonardo Diaz, Jr. to conduct preliminary investigation on
the complaint.  Orient Bank received a cease-and-desist
order from the Bangko Sentral ng Pilipinas on May 7, 1999
for huge unpaid accounts.

During the time of its closure, it was alleged that Orient
Bank closed due to mismanagement problems. (ABS/CBN News
Channel  10-Jun-2000)

PHILIPPINE NAT.BANK: Gov't to sell 30% stake anyway
---------------------------------------------------
The Philippines government will continue with the sale of
30 percent of the Philippine National Bank (PNB) despite a
refusal by 46 percent stakeholder Lucio Tan to participate
in the sell-out, said Bangko Sentral Governor Rafael
Buenaventura.

To prevent the sale, Mr Tan would have to infuse about P10
billion (US$236.4 million) in fresh capital.  The bank has
the highest non-perfoming loans in the country, estimated
at around 36 percent, compared to the average NPL ratio of
around 12 percent, and these are blamed for the lack of
buyer interest. Loida Nicolas Lewis of the US based TLC
Beatrice Holdings, Inc was unsuccessful in her attempt to
acquire 76 percent of the bank's shares in the first bid.
(Asia Pulse  09-Jun-2000)

PHILIPPINE NAT.BANK: Extension of sale deadline sought
------------------------------------------------------
The Philippines will ask the International Monetary Fund
(IMF) to extend the deadline for the sale of the
government's 30% stake in the Philippine National Bank
(PNB) until 2001 after the scheduled bidding for a
controlling stake in the bank failed to materialize Friday.

The IMF had given the government until June 10 to fully
privatize the former national bank as part of the
requirements for the current $1.4 billion loan program.

"We will have to seek an extension from the IMF for its
June deadline," said Finance Undersecretary Cornelio Gison.

He said, however, that the multilateral agency has
expressed satisfaction over the government's transparency
in the process of disposing PNB.  The government was
supposed to dispose its stake in PNB Friday together with
the 46 percent-stake held by tycoon Lucio Tan, but the
auction was canceled after one of the two bidders failed to
find a local bank partner.

Filipino-American billionaire Loida Nicolas-Lewis, owner of
US-based TLC Beatrice Group, failed to find a local bank
partner that would allow her to prequalify in the PNB sale.
Under the newly passed General Banking Act, only companies
with banking interests are allowed to have 100% ownership
of a local bank. Other non-banking companies, such as the
TLC Group, can only own a maximum of 40% stake in local
banks.

Yuchengco-owned Rizal Commercial Banking Corporation
(RCBC), one of the Philippines' top-tier banks, was the
only bidder allowed to tender bids.  Venus Legaspi,
executive director of the Committee on Privatization (COP),
said the IMF must give the country another year to dispose
its remaining stake in PNB.

The COP official said the government will decide next week
whether to rebid the government's interest or to simply
negotiate with interested buyers.  Gison said the
government would also try to convince Templeton Asset
Management Limited, a Hong Kong-based fund manager with 12%
in PNB, to join the state in its plan to rebid PNB.
(ABS/CBN News Channel  10-Jun-2000)

PHILLIPINE NAT.BANK: Tan interested in Gov't's stake
----------------------------------------------------
While options to sell his 46-percent stake at the
Philippine National Bank (PNB) remain open, taipan Lucio C.
Tan is also reportedly keen on buying the government's 30-
percent.

"He (Tan) is just weighing things-if selling would be
better or if acquiring the (government's) 30-percent (is),"
a well-placed sourced told THE MANILA TIMES over the
weekend.  "It would make a difference if Mr. Tan would own
whole of PNB most especially that it appears that he won't
be able to merge his own Allied Bank with PNB because there
are sequestered shares in Allied," he added.

Sources pointed out that chances of Tan staying in the bank
are reflected in an official statement of the PNB
management revealing plans to formulate a long-term
strategy to revive the bank.

"Now that PNB's ownership is definite, at least in the
meantime, the management team can now focus on managing the
bank rather than waiting for the new owners to come in,"
PNB president Feliciano L. Miranda Jr. earlier said.
"Management has already started applying the eight-point
strategy outlined by Mr. Tan, which involved immediate cost
reduction, a focus on medium and small loans, continuous
personnel training, aggressive deposit generation,
collection of non-performing loans, disposal of non-
performing assets, infusion of fresh capital, and banning
of political loans," he said.

The tycoon and the government had fused their respective
shareholdings last summer and sell it as a block afterwards
through a public auction in a bid to attract a high
premium.  Unfortunately, the sale bogged down when only one
investor was pre-qualified-the Rizal Commercial Banking
Corp. (RCBC)-after the other bidder, Filipina-American
billionaire Loida Nicolas-Lewis, failed to comply with the
condition to find a local banking partner.

Lewis, majority stockholder of US-based food manufacturer
TLC Beatrice Holdings, had promised to "restore PNB's
greatness." She teamed up with the Templeton Asset
Management of Hong Kong, which owns 12.9 percent of PNB, to
strengthen her bid.  Alleged plans of Tan to purchase the
30 percent government shares had already received a
positive response from Finance Secretary Jose T. Pardo who
in an interview with reporters late Friday night affirmed
willingness as long as the price would be at least P140 per
share.

"If it is P140, I will seriously consider it as long as
there is a right to match (Tan's offer) by anybody or other
investors," Pardo said.

However, he also stressed that the government is still more
inclined to do another public bidding for its shares and
possibly resort to a negotiated sale in case of another
failed bidding. He said he will ask Tan to temporarily hold
off any capital call until government has found a buyer for
its stake.  Moreover, in case Tan pursues plans to unload
his stake, the government should be informed as to who the
buying party would be.

"There are still interested parties who just did not meet
the deadline for pre-qualification. So I told (Finance
Undersecretary Cornelio) Gizon to put the bidding in place
again. We want to go ahead with it or perhaps talk with
RCBC and Ms. Lewis, to know what they are thinking. Anyway,
Ms. Lewis had said that she was committed to help PNB,"
said Pardo.

For his part, Bangko Sentral ng Pilipinas Governor Rafael
B. Buenaventura said that the other fallback measures the
government could utilize include retaining its 30-percent
stake on an interim basis until its value moves-up, in time
for a sale that would yield a high price.  If this would
not be feasible (as this demands fresh capital infusion
using fiscal funds), another dilution of the government
holdings by about 33 percent to 20 percent from 30 percent
might be inevitable-Tan is poised to implement a capital
call, said Buenaventura.  (Manila Times  12-Jun-2000)

VICTORIAS MILLING CO.: Asks SEC to quash liquidation motion
-----------------------------------------------------------
Victorias Milling Co. Inc. has asked the Securities and
Exchange Commission to junk the motion filed by Bank of the
Philippine Islands seeking the liquidation of the cash-
strapped sugar firm's assets, saying the SEC has no
authority to declare as insolvent and order the dissolution
of a company.

Victorias management said it was the Regional Trial Court
and not the SEC which could decide whether a company was
insolvent or not.  Victorias said that even if the SEC had
the authority to order the dissolution of a company, the
assets of the company could not be subject to liquidation
since there was still no duly-approved rehabilitation plan.

It said that the plan submitted to the SEC calling for a
cash infusion of P500 million was unconditional. Following
a failed bidding of 53.35 percent of its capital stock last
March 21, Victorias filed with the SEC a new alternative
rehabilitation plan calling for the conversion of P3.91
billion of debts into equity and the restructuring of P1.29
billion debts over a period of 15 years.

The March 21 bidding was declared a failure when pre-
qualified biddersCargill Inc. and RCBC Capital Corp.failed
to show up. The two were supposed to deposit at least 10
percent of the base price of Victorias shares to be
auctioned off in an escrow account with any of the
accredited banks.

The debt level of Victorias has grown to P6.5 billion from
P5.18 billion due to accumulation of unpaid interest that
should have been paid from the firm's cash flow had the
rehabilitation plan been implemented earlier.

In addition to this, the contingent liability of P630
million could go to as much as P834 million if the SEC so
decides to consider the refined sugar delivery order claims
as direct liabilities of the company. This has further
increased the company's debt level to P7.39 billion.

Under the new alternative plan, Victorias was also looking
at securing a new loan in the amount of P400 million at 10
percent interest rate payable in three years to finance its
capital expenditures. (Manila Times  09-Jun-2000)


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

CARREFOUR SINGAPORE: Trims S'pore loss; dismisses pull-out
----------------------------------------------------------
French retail giant Carrefour slashed its net loss on its
Singapore hypermarket at Suntec City by 80 per cent to $2
million last year on the back of a 10 per cent rise in
sales to around $115 million.  It also said market talk
that the group would pull out of Singapore if it failed to
clinch more store sites soon is "totally out of the
question."

When Carrefour entered the Singapore market in 1997, it
said it planned to have five stores on the island within
five years.  But to date, the retailer continues to operate
only at Suntec City.  Last year's smaller loss was due to
lower amortisation and depreciation costs, and the trend of
local staff replacing expatriates in management positions,
among other factors.

Time and again, Carrefour has missed opportunities to
clinch big hypermarket sites -- including Hougang Point and
IMM Building, which went to rivals NTUC FairPrice and Dairy
Farm group's Giant venture.  Carrefour Singapore managing
director Herve Clec'h acknowledged in an interview with BT
that to raise the group's chances of finding store sites,
the retailer had lowered its minimum store size requirement
to 40,000 sq ft, from 100,000 sq ft, even as it continues
its search.

Typically, Carrefour runs several hypermarkets in each
country where it operates to tap economies of scale. It has
six hypermarkets in Malaysia, nine in Thailand and 23 in
Taiwan. This had given rise to talk that it may pull out of
Singapore if it failed to nail down some deals soon for
more stores.

Mr Clec'h said Carrefour was comfortable continuing to
operate just at Suntec City "as long as we are well
patronised by our customers."

He also noted that even with only one store in Singapore,
Carrefour can still tap economies from being part of a
global purchasing network that covers more than 9,000
stores of different formats, including hypermarkets,
supermarkets and convenience stores.

Carrefour, which has a 12-year lease for its 93,108 sq ft
store at Suntec City, is said to be negotiating with
landlord Suntec City Development (SCD) on a review of
rental rebates introduced a few years ago to help Suntec's
retailers tide over the slump. Retailers' fortunes have
since improved.

Both Suntec and Carrefour officials yesterday declined to
comment on the status of their discussions beyond saying
that they have a good relationship and will work out a
mutually acceptable solution.

Carrefour Singapore's top three performers last year in
terms of year-on-year increase in sales were electronics
goods, sundries -- including DIY, housekeeping, toys,
sporting equipment and car and garden accessories -- and
beverages such as soft drinks and wines.  The sales split
was equal between food and non-food items.

For the first five months of this year, turnover was up by
about 10 per cent over the same period last year, but Mr
Clec'h is projecting a single-digit increase for the full
year. Mr Clec'h said the plan was to break even next year.

Carrefour staff in Singapore along with their counterparts
worldwide will be given a chance later this year to buy
shares of the Paris-listed group at a preferential price,
Mr Clec'h revealed. This scheme will be unlike share
options, for which staff typically have to wait for a few
years before the options can be exercised.

Bank financing will be provided for the scheme but Mr
Clec'h could not reveal more details.  Carrefour's
traditional strength was in hypermarkets. But following its
purchase of the remaining 40 per cent stake in supermarket
chain Comptoirs Modernes in late 1998, and its merger with
rival giant Promodes last year, the group's formats also
include supermarkets, discount stores and cash and carry
outlets. Its 9,000 outlets are located in Europe, Latin
America and Asia. (Business Times  09-Jun-2000)

IPC CORP.: Awaiting SGX approval of rehab plan
----------------------------------------------
Responding to auditors' concerns about its 1999 results,
IPC Corporation yesterday said it was awaiting the
Singapore Exchange's approval for its debt-restructuring
plan and expressed confidence that it would continue as a
going concern.

On Wednesday, IPC's auditors, Ernst & Young, issued a
disclaimer of opinion on IPC's 1999 results and raised
"substantial doubt that the company can continue as a going
concern."

The news sent IPC's shares sinking 20 per cent to 21.5
cents yesterday, with 39 million shares traded. IPC said in
a statement yesterday that "similar disclaimers have also
been made" over its 1997 and 1998 results, and gave reasons
why it strongly believed it would survive.  With a debt
restructuring plan approved by creditors in March and
approved by the High Court in April, IPC's German white
knight, Infomatec AG, has deposited US$20 million (S$34.4
million) in escrow with Arthur Andersen, IPC's scheme
administrator. This amount will be injected into IPC as
fresh capital.

IPC has also submitted an application to the SGX for the
listing and quotation of new shares to be issued under the
debt restructuring plan.  When approved, an extraordinary
general meeting will be called.

"The company is confident that the shareholders will
approve the debt restructuring plan," the statement said.

IPC also pointed to its "various major efforts" to
reposition its core businesses in the e-commerce, thin
computing and telecoms areas as further evidence that it
would continue as a going concern.  BT understands that the
company expects to be able to obtain shareholder approval
in the next two months, paving the way for the company to
become debt-free. (Business Times  09-Jun-2000)

TRANSMARCO: Narrows annual loss                            
-------------------------------                            
Transmarco expects to be profitable in the current year
after slashing group net loss by 60 per cent to $7.7
million for the year ended March 31 this year.

Contributing to the better outcome was the deconsolidation
of loss-making Lanka Bell's results from Transmarco's
accounts from Oct 1 last year. In fact, the group turned
around in the second half of the financial year just ended,
achieving a pretax profit of $2.6 million in the final six
months, compared with a loss of $15.9 million in the first
half.

The second half excluded the results of Lanka Bell
following the deconsolidation. In addition, the performance
of the group's other businesses also improved during the
period. The retail and distribution division achieved an 81
per cent increase in pretax profit to $3.5 million over the
first half.  However, for the full financial year, the
group recorded an operating pre-tax loss of $13.4 million,
a decline of $16.8 million over the previous year.

The deficit was incurred mainly by Lanka Bell, which
chalked up a $16.8 million loss in the first half year to
Sept 30 last year. The retail and distribution division
achieved a 270 per cent jump in pretax profit, from $1.5
million to $5.5 million. The footwear business, in
particular, managed a turnaround with a $1.6 million
profit, against $1.2 million loss in the previous year.

Transmarco noted that Lanka Bell's financial position has
not improved and as at March 31 this year, it had a deficit
in shareholders' funds of about $900,000.  Group turnover
improved marginally to $100.3 million even with the
deconsolidation of Lanka Bell, thanks to a significant jump
in sales of the retail and distribution division,
particularly the footwear business. In contrast, the
deconsolidation of Lanka Bell's results as well as fewer
projects by TransTel Engineering pushed down the telecoms
division's turnover from $18.6 million to $7.4 million.

A $24.6 million extraordinary loss -- mostly for writing
off its investment in and amount owing by Lanka Bell --
resulted in a bottomline loss of $32.3 million, lower than
the $49.2 million bottomline loss chalked up in the
previous year.  Transmarco's loss per share was 28 cents,
down from 69.75 cents in the previous year. Net tangible
asset backing per share dropped to 82 cents from $1.37
previously.  No dividend was declared. Transmarco closed 11
cents up yesterday at $1.17 on volume of 11,000 shares.  
(Business Times  10-Jun-2000)


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

BANGKOK STEEL INDUSTRY: Debt talks stall plans for merger
NTS STEEL PLC: Debt talks stall plans for merger
---------------------------------------------------------
A planned merger of four steel manufacturers has been
delayed indefinitely because the debts of NTS Steel Plc and
Bangkok Steel Industry Plc have not been fully
restructured.

A business rehabilitation plan for NTS, the flagship
company of Sawasdi Horrungruang, has won creditor approval
but negotiations were continuing on some crucial details of
the plan, said Wirash Krittaphol, senior vice-president of
Siam Cement's steel group.

Among the details under negotiation are the proportions of
debt write-downs, as well as the amount of new funds to be
injected into the company.  Mr Wirash said he expected the
talks on NTS and Bangkok Steel Industry to take a few more
months. As a result, there would be a delay in the planned
merger between the two companies and two steel
manufacturing units of the Siam Cement Group: Siam Iron and
Steel Co and Siam Construction Co.

He expressed optimism that a merger agreement could be
reached by the end of the year.  Earlier, five companies
had agreed to the merger, but the Nam Heng Steel Group
recently withdrew, he said.  Under the merger plan, Mr
Wirash said, a new company would be established to operate
the merged steel factories in order to better control
production costs, reduce duplication and improve marketing.

The merger would be achieved by way of a share swap.
However, as the plan was now on hold, details and
conditions of the share swaps were not being discussed, Mr
Wirash said.  A source at NTS Steel said Mr Sawasdi
remained fully committed to the merger plan, and had been
lobbying creditors to accept the merger as part of the
company's business rehabilitation plan.  

In mid-April, creditors representing 85.66% of the 15
billion baht owed by the company to 16 creditors voted to
approve the debt-restructuring plan.  It involves a debt-
to-equity conversion of 11 billion baht in debt and the
rescheduling of the remaining four billion baht in
repayments to 14 years.

The rescheduled debt would be subject to a 0.5% annual
interest rate for the first two years and 3% in the third
year. From the fourth year onward, the rate would be
equivalent to the minimum lending rate of Krung Thai Bank.
After the plan is completed, Mr Sawasdi's stake in NTS
Steel would fall to 2% from 60%.  (Bangkok Post  09-Jun-
2000)

SIAM CITY CEMENT: To merge two units before IPO
-----------------------------------------------
Siam City Cement, Thailand's second-largest cement maker,
plans to merge the operations of its two non-core
subsidiaries, Royal Porcelain and Siam Fine China, this
year before conducting an initial public offering (IPO) of
the merged entity over the next two to three years.

The move is part of its strategy to focus on its core
cement and construction materials businesses.  The
company's managing director Paul Hugentobler said the
merging of Royal Porcelain and Siam Fine China was aimed at
streamlining operations. Over the next two to three years,
it will use funds from the IPO to strengthen its core
operations.

The company holds 53.4 per cent of Royal Porcelain, which
has a 100-per cent stake in Siam Fine China. A porcelain
tableware producer, Royal Porcelain is capitalised at Bt468
million, compared to Bt1 billion for Siam Fine China, a
manufacturer of bone china tableware.

The porcelain group has experienced a financial turnaround,
from a loss of Bt20 million in the first quarter of last
year to a profit of Bt12 million in the same period this
year. Its current workforce totals 3,000, but this will be
reduced after the merger. The number of layoffs has not yet
been determined.

The factories of the two companies are located in Kaeng
Khoi district, Saraburi province.  After the company was
taken over by Swiss-based Holder Bank Financier Glarus in
1998, it restructured its operations, which included
disposing of its non-core subsidiaries, liquidating all of
its overseas investments and reducing distribution
warehouses and terminals from 127 to 29.

In further restructuring, Siam City Cement plans to sell
its 100-per cent stake in Karat Faucet, a manufacturer of
bathroom fittings next year. The company plans to maintain
its 25-per cent stake in Lanna Lignite, since the energy
affiliate is a vital supplier of fuel to its cement plant.

It has also sold about a 43-per cent stake of Karat
Sanitaryware, while it liquidated its holding in Ceratech,
a producer of ceramic wall and floor tiles.  The company
sold off a 50-per cent stake in corrugated paper box
manufacturer City-pack to Siam Packing Group, while just
last week it sold a 50-per cent stake in Gulf Electronic to
The Electricity Generating Co. Siam City Cement still
indirectly holds a 50-per cent stake in Gulf Electronic
through Lanna Lignite.

Speaking about Siam City's performance, Hugentobler said
the company reported a profit of Bt575 million in the first
quarter of this year, compared to a loss of Bt431 million
during the same period last year, with a net profit of
Bt2.30 per share. However, net sales declined from Bt3.46
billion in the first three months of last year to Bt3.31
billion in the same period this year due to an ongoing
slump in the domestic market.

He explained that the improved performance resulted from
debt restructuring and refinancing in last year. Siam City
entered into an agreement in last July with creditors over
its US$542 million (Bt21.1 billion) long-term debt, whereby
it repaid an initial $250 million. That, along with the
completion of debt refinancing in November, reduced its
interest expense by 50 per cent to approximately Bt700
million this year.

Starting in August, Siam City Cement will begin to repay
the remaining debt. By the end of this year, the company
will be free of long-term liabilities and have a Bt5
billion debenture remaining.

The company intends to increase exports of bulk cement,
which generate better margins than domestic sales, from 1.7
million tonnes last year to 2 million tonnes this year. It
expects to maintain a 27 to 28 per cent market share
domestically, while the local market is expected to grow by
only 3 to 5 per cent this year.  (The Nation  09-Jun-2000)


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
newsletter co-published by Bankruptcy Creditors' Service,
Inc., Trenton, NJ USA, and Beard Group, Inc., Washington,
DC USA. Darryl Henning, Managing Editor, James Philip P.
Jover and Cristina Pernites, Editors.

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

This material is copyrighted and any commercial use, resale
or publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly
prohibited without prior written permission of the
publishers.  Information contained herein is obtained from
sources believed to be reliable, but is not guaranteed.

The TCR -- Asia Pacific subscription rate is $575 for 6
months delivered via e-mail. Additional e-mail
subscriptions for members of the same firm for the term of
the initial subscription or balance thereof are $25 each.
For subscription information, contact Christopher Beard at
301/951-6400.  

                      *** End of Transmission ***