Isle bankers $5 millionBy Peter Wagner
house in Singapore
sought by Citibank
Citibank N.A. Hong Kong is seeking to recover a $5 million Singapore residence from frozen assets in the bankruptcy of Indonesian businessman Sukamto Sia.
The bank yesterday asked U.S. Bankruptcy Judge Lloyd King to lift the court's jurisdiction over the property in order to foreclose under Singapore law.
King deferred the request, opposed by court-appointed trustee Guido Giacometti, pending a 30-day investigation of the property. A final hearing is scheduled May 24.
The 39-year-old Sia, formerly Sukarman Sukamto, filed for Chapter 11 reorganization bankruptcy in November listing about $9.3 million in assets and $296.4 million in debts.
Giacometti last week asked the court to convert the case to a Chapter 7 liquidation.
If approved, Sia's "pre-petition" assets -- those held before he filed for bankruptcy -- would be sold to repay creditors.
Citibank claims to hold a mortgage lien on a house at 16 Bishopsgate, one of two residential properties owned by Sia in Singapore.
Valued in a recent appraisal by the bank at about $5 million, the property is shown in earlier bankruptcy filings as being worth $6.5 million
Sia's other Singapore property, at 5 Balmoral Road, is valued in bankruptcy filings at $800,000.
Sia, majority owner of Bank of Honolulu, has asked that both properties be exempted from his bankruptcy -- spared from liquidation -- under provisions of U.S. bankruptcy law allowing debtors to keep some personal property.
Giacometti says the exemptions won't be allowed because the property isn't in Hawaii.
Citibank says it loaned Sia a total of $7 million between March 1995 and November 1996, accepting 16 Bishopsgate as collateral.
Honolulu attorney David Rosen, representing Citibank, yesterday said the house has been vacant for more than a year and it's pool, full of mosquitoes, has become a health problem.
In court filings the bank argues that the property would contribute nothing to a liquidation of Sia's assets, or recovery of claims against him, because he has no equity in the property.
But Giacometti, citing a lack of detail provided by Citibank, asked for more time to investigate the property transaction.
mong the questions, he said, is the stated $5 million value of the house, based on an external inspection of the property.
He also noted that a strict conversion from Singapore to U.S. currency puts the bank's assessment at $4.5 million.
Giacometti said he plans to hire an attorney in Singapore to help in the investigation.