Robert Go, Jakarta – The Indonesian public received a huge shock yesterday when restructuring agency Ibra closed its books for good and handed over a bill for the economic crisis that began in 1997: around 477 trillion rupiah, or S$94 billion.

For some, this is the final chapter in a five-year reform effort; others say the process is not yet over.

Many Indonesians who can barely feed, clothe and house themselves now have to swallow the bitter pill and pay the multibillion-dollar bill.

Here is a synopsis of Ibra's five-year saga:

1. Between 1997 and 1998, banks started to fail. The government was saddled with billions of dollars in debt that was owed to the government by powerful tycoons and former president Suharto's children, who controlled most of the country's industries.
2. The government injected trillions of rupiah into the system to halt the meltdown.
3. In 1999, Jakarta signed deals with the banks' owners, some of the richest men in the country. The indebted tycoons get 'stay out of jail' cards.
4. Instead of using cash to pay their debts, bank owners handed over assets – shares in companies, banks, office buildings, apartment blocks, five-star hotels and land – valued at about 616 trillion rupiah.
5. Enter Ibra. Its mandate was to manage, restructure and eventually sell the transferred assets, and therefore recover cash that Jakarta had spent during the bail-out process.
6. After five years, Ibra had sold key assets but at 172.4 trillion rupiah, revenue came nowhere near the more than 600 trillion rupiah credit Jakarta had extended to banks.

   Ibra was supposed to do all the right things: Fix ailing banks, tell debtors to pay up, drag those who don't through the courts, and eventually punish them to make sure the negligence and greed that helped cause the crisis would never happen again.

   It didn't work out that way. Because of the huge amount of money and the personalities involved, Ibra itself became vulnerable to political interference, weak courts and corruption.

   Indonesia has now turned out the second costliest banking sector bail-out ever, behind the one that Argentina undertook in the 1980s.

   Mr Syafruddin Temenggung, Ibra's seventh chairman since 1999, last week claimed a victory and a 'job well done' for his agency.

   He said non-performing loans had fallen from 50 per cent in December 1998 to just 5 per cent now.

   Based on capital adequacy ratio figures, local banks are now healthier than those in Thailand, Malaysia, South Korea and the Philippines, he said.

   The 28 per cent recovery rate for Ibra, the chairman explained, is comparable to the amounts Thailand and South Korea recouped in their own bail-out experiences. "The agency has met all targets. It is time for Ibra to stop," he said.

   Others, especially those outside of Ibra or the government, hold a different view. Some wanted to know why Ibra had so many chairmen changes in a short time frame.

   A Western banker in Jakarta said the fact that Ibra had seven chairmen in five years indicated there has been constant meddling in its affairs.

   The frequent turnover at the top made execution of policy decisions difficult. Every top man came in with a different agenda. "Instead of letting Ibra do its job under one guy, they kept tinkering and caused problems," the banker said.

   A former chairman of Ibra once told The Straits Times that it was a rare day when someone high up on the political ladder didn't call "to suggest how we do our jobs". Working out how to deal with such calls had become a major part of his day and complicated the way some debtors were dealt with.

   The country's bribery-prone courts are also to be blamed for Ibra's poor showing. Mr Syafruddin said he had initiated 18 cases against bad debtors during his tenure at Ibra, but most just ground to a halt.

   This inability to jail uncooperative tycoons, observers said, only emboldened other bad debtors, who saw no reason to worry about the possibility of prosecution.

   Corruption and collusion might have reared their heads here, too. Analysts said many of the assets Ibra accepted from debtors had been overvalued, and that could not have happened without the consent of government officials.

   Mr Syafruddin told an anecdote that well illustrated the problem. The story was that of a debtor who had submitted 10ha of beachfront land in the highly sought-after tourist area of Kuta in Bali. This site would be worth millions of dollars.

   But when Ibra investigators looked, they couldn't see the site. After consulting locals, they were told to wait for low tide – the land in question is under the sea for most of the day.

   Scandals have followed many of Ibra's sales, with critics arguing that buyers and bidders for those assets had been acting on behalf of their old owners, something that Indonesian law forbids.

   If such cases did occur, then former owners clearly benefited, again at the expense of regular taxpayers and the state, as they got to buy back their old properties at depressed prices.

   By its last week of operation, Ibra still had unsold assets worth 60 trillion rupiah. A new holding company will be formed to manage and ultimately get rid of them.

   Observers said Indonesia was perhaps doing the right thing now by cutting its losses and closing this chapter of its history. And as Mr Syafruddin pointed out, all the fallout from Ibra could end up simply being labelled as "the cost of the crisis".