Jakarta – The International Monetary Fund (IMF) yesterday described Parliament's approval of the sale of a 51 per cent government stake in Indonesia's largest private retail bank as an important milestone in economic reforms of the country.

The Lower House late on Wednesday approved the sale of the PT Bank Central Asia (BCA) stake, which was taken over by the government in 1998 to save it from collapse at the height of the regional financial crisis.

"This decision is a very encouraging sign of progress in several respects," said IMF senior resident representative in Indonesia David Nellore. He said the sale of the bank would be an "important milestone in the reform process" building on recent measures including the budget, strengthening the corporate restructuring process and the banking system.