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Bank Indonesia Approves Mulya’s Request for Non-Active Role

Bank Indonesia’s board of governors approved a request by Deputy Governor Budi Mulya to be given a “non-active” role because of “personal reasons,” the central bank said in a statement on its website today.

The status is valid for six months starting Oct. 20 and can be extended by another six months, the statement said. During his non-active status Mulya’s responsibilities will be assigned to other members of the board, it said.

Mulya is the latest target of probes into the 2008 PT Bank Century bailout. He is under investigation by the state auditor regarding a “personal” 1 billion rupiah ($112,297) loan he obtained from the former owner of Bank Century, Difi Johansyah, a Jakarta-based spokesman at Bank Indonesia, said on Oct. 3.

The Bank Century rescue at the height of the global financial crisis was attacked by President Susilo Bambang Yudhoyono’s political allies, with parliament voting last year for a criminal probe of Vice President Boediono and then Finance Minister Sri Mulyani Indrawati.

Bank Century, and its 6.7 trillion-rupiah government bailout, was at the center of a campaign by opposition lawmakers against Boediono and Sri Mulyani, who left last year to become one of the World Bank’s managing directors. Two major partners in Yudhoyono’s coalition, Golkar and the Prosperous Justice Party, joined the opposition in accusing the officials of abusing their authority during the rescue.

Mulya obtained a loan from a Bank Century owner in October 2008 and returned it in January 2009, Johansyah said Oct. 3. The probe is part of a state audit of the lender, he said.

To contact the reporter on this story: Novrida Manurung in Jakarta at nmanurung@bloomberg.net

To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net

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