Jakarta – An Indonesian body charged with monitoring business practices on Wednesday began investigating reports of alleged collusion in the government's bid to sell it shares in the country's largest private bank, Bank Central Asia "We will summons the parties concerned including the Indonesian Bank Restructuring Agency," said Muhammad Iqbal, the chairman of the government-sanctioned Commission for Monitoring of Business Competition.

"If the process of divesting BCA smacks of collusion we will order a retender," Iqbal told reporters after meeting Indonesian President Megawati Sukarnoputri.

He said his body, which has the power to cancel tenders, had received reports from "members of the public" of suspected collusion in the sale.

The government took over the bank from the heavily-indebted Salim Group at the peak of the Asian financial crisis in 1998.

Despite denial by government officials, there has been speculation the government might be prepared to sell its 51-percent stake in the bank to its former owner. Activists have protested a possible deal with Salim.

State Enterprises Minister Laksamana Sukardi last week denied the speculation, saying the stake will only be sold to "bona fide institutional investors" who can increase the value of BCA.

The sale of the government's stake in BCA is a key plank of its asset sell-off and privatisation program, aimed at raising revenue to help plug a budget deficit.