ASIATODAY.ID, JAKARTA – The Indonesian government has issued global debt securities in dual-currency, namely US Dollars and Euros. The issued value has reached US$1.8 billion and 750 million euros.
In an official statement from the Directorate General of Financing and Risk Management, Ministry of Finance of the Republic of Indonesia, it was explained that the issuance of global bonds in SEC format was the 15th issued.
There are three series of global bonds released by the Indonesian Government, namely RIEUR0932 with a term of 8 years, RI0934 with a term of 10 years, and RI0954 with a term of 30 years. RIEUR0932 was issued with a value of up to 750 million euros and a coupon of 3,650%.
For US dollar denominations, the Indonesian government managed to pocket US$1.8 billion. In more detail, RI0934 was released with a value of US$1.15 billion and a coupon of 4.750%. Meanwhile, RI0954 was released with a value of US$650 million and a coupon of 5.150%.
Meanwhile, this global bond offering has attracted global investor interest, reaching a total orderbook of US$8.5 billion and 3 billion euros. As a result, the Government can reduce the rate of return for all tenors offered to investors. The final yield for the 8, 10 and 30 year tenors was 3.723%, 4.800% and 5.200% respectively.
“The success of this transaction shows strong investment interest from various types of investors from various global regions for Indonesia. This high investor interest is partly due to Indonesia’s economic fundamentals and the solid performance of the State Revenue and Expenditure Budget (APBN),” wrote DJPPR in its written statement on Thursday, September 5, 2024.
The third series of SUN issued in this transaction received a Baa2 rating from Moody’s, BBB from Standard & Poor’s, and BBB from Fitch, and will be listed on the Singapore Exchange Securities Trading Limited and the Frankfurt Stock Exchange.
In a written statement, the Directorate General of Financing and Risk Management explained that the publication of SUN was to optimize stable market conditions with favorable interest rates amidst expectations of a reduction in the Fed’s benchmark interest rate.
The transaction also marks the second publication of SDG bonds in euro currency after being last published in 2021. In the SDG bond publication, the Government refers to the SDGs Government Securities Framework (SDGs Framework) which is in line with international standards including the principles of the International Capital Market Association (ICMA).
The results of general SUN publications will generally be used to finance the 2024 APBN. Specifically for SDG bond issuance, the Government will allocate funds equal to the publication proceeds to finance programs and projects that qualify for Eligible SDGs Expenditures in the SDGs Framework. (AT Network)
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