Indonesia authorities question Maybank staff over Salim Group palm oil export flows: sources

[JAKARTA] Indonesia authorities questioned bankers at the local unit of Malayan Banking as part of their investigation into suspected export flows involving the Salim Group that may have understated the actual amount, according to people familiar with the matter.

The queries focused on transactions related to the export activities of Salim Ivomas Pratama, one of Indonesia’s biggest palm oil producers, the people said, asking not to be identified because the probe into the firm is not public. Bankers from Maybank Indonesia carried boxes of documents to the Attorney General office last week to face questions as witnesses, they said.

Authorities are scrutinising if some goods are invoiced below their ​market price in an attempt to conceal profits and reduce ​taxes. They said last month they are investigating 10 major palm producers in the country for alleged manipulation of crude palm oil export prices, though it is unclear if Salim Ivomas Pratama is among the firms being probed by the government.

In the questioning of the Maybank staff, it is not clear if any wrongdoing has been established. Neither the company nor the bank has been accused of misconduct.

Maybank Indonesia “remains committed to maintaining the highest standards of governance and compliance, and cooperates with the relevant authorities in accordance with applicable laws and regulations”, a spokesperson said in response to queries from Bloomberg. The spokesperson added the bank is unable to comment on customer relationships, or any matters that may be subject to regulatory and legal, as a matter of policy.

A spokesperson for the Attorney General’s office declined to comment. Salim Ivomas Pratama did not respond to requests for comment.

Maybank Indonesia’s exposure to Salim Ivomas Pratama is relatively modest at around 150 billion rupiah (S$11.3 million), according to the firm’s latest financial statement. However, the lender has for years been a key banking partner to the broader Salim Group. It is unclear whether other banks linked to the group have been questioned.

Investigators are seeking information about banking facilities extended to the company and the nature of its financing arrangements. The lender provided revolving credit facilities intended for working-capital needs rather than specifically to fund exports, the people said. Authorities are examining whether any of the facilities were connected to transactions now under scrutiny.

While further details of the investigation remain unclear, the questioning of bankers signals that authorities are widening their examination beyond exporters to include financial institutions that facilitated transactions linked to the commodity trade.

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Indonesia’s financial markets themselves are experiencing heightened scrutiny. The central bank unexpectedly raised its key interest rate in an out-of-cycle decision on Tuesday, seeking to support the rupiah after a sell-off in equities and bonds fuelled capital outflows.

Market participants have expressed unease over a series of policy initiatives that expand the state’s role in directing investment and managing strategic sectors of the economy.

Last month’s clamp down on exports marked one of the clearest signs yet that President Prabowo Subianto is moving aggressively to tackle what he views as leakages in Indonesia’s natural-resource sector. Sales will eventually be conducted by a government-appointed exporter under the control of sovereign wealth fund Danantara to ensure proceeds are no longer routed offshore.

Since taking office in 2024, Prabowo has sought to harness the nation’s raw materials and crack down on the tycoons and merchants he accuses of syphoning off riches the country should earn from their sales.

Salim Ivomas Pratama is part of the Salim empire, one of Indonesia’s largest family-owned conglomerates that has a range of businesses from food and agriculture to mining and data centres. It dates back to the early 1970s, was founded by Soedono Salim and is now headed by his son, CEO Anthoni Salim. BLOOMBERG