Indonesia Raises $1.3b in Bond Sale to Help Finance Budget Deficit
[Updated at 11:15 p.m. on Tuesday, March 4, 2014]
Jakarta. Indonesia raised Rp 15 trillion ($1.3 billion) from selling bonds and bills on Tuesday, the most since early this year as the government seeks funds to plug the country's budget deficit.
Improving economic outlook coupled with slowing inflation has lured more investors to buy into the country's assets, such as bonds.
The government sold Rp 4 trillion of bonds maturing in March 2020 to yield at 8.59984 percent, the Finance Ministry's debt management office said in a statement published on its website.
It also raised Rp 3.2 trillion from selling bonds maturing in February 2044 at a yield of 9.04476 percent, Rp 2.9 trillon of bonds due in March 2024 at a yield of 8.08732 percent, Rp 1.9 trillion bonds due in April 2019 to yield at 7.84896 percent, Rp 2 trillion of bonds maturing in March 2015 to yield at 6.26667 percent. The country also raised Rp 1 trillion from selling bonds maturing in June 2014 at a yield of 5.6122 percent, according to the statement.
Indonesia has been selling bonds since the monetary crisis more than a decade ago to plug a budget deficit, forecast to reach Rp 175 trillion or 1.7 percent of the gross domestic product this year.
The government has received Rp 39.1 trillion in incoming bids for the bonds on offer, suggesting a rising appetite by investors to hold the country's notes.
The government has raised more than Rp 40 trillion so far this year on four sales of similar securities.
In a separate development, the government sold Rp 19.3 trillion of local-currency Islamic bonds, or sukuk, to individual investors in Indonesia. The retail sukuk was sold at coupons of 8.75 percent, according to the statement.
Self-employed Indonesians were the biggest buyers, taking 32 percent of the notes, followed by private-sector employees with 27 percent, housewives with 17 percent and others with 19 percent.
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http://www.thejakartaglobe.com/business/adira-seeks-200m-to-finance-lending-business-in-indonesia/
Adira Seeks $200m to Finance Lending Business in Indonesia
Jakarta. Adira Dinamika Multi Finance, the financing unit of Bank Danamon Indonesia, is seeking $200 million in three-year bank loans from foreign lenders to support its automotive financing business.
"We are now processing the loan. We are hoping it can be secured in April," I Dewa Made Susila, director and chief financial officer of Adira Finance told Investor Daily.
Bank of Tokyo Mitsubishi-UFJ, BNP Paribas and Deutsche Bank have been named the lead arrangers of the loan, the report said.
Adira Dinamika is the financing unit of Bank Danamon, Indonesia's fifth-largest lender by assets, and focuses on automotive financing. The company has 680 branches across the country with about 3.7 million customers.
Adira is hoping to raise its lending by 9.5 percent to Rp 37 trillion this year from last year's Rp 33.8 trillion.
The Asean Automotive Federation (AAF) reported motorcycle sales growth in the region was 5 percent in 2013 with 11.09 million sold across member nations. Indonesia accounted for 7.7 million units, or approximately 70 percent of the total in the Association of Southeast Asian Nations.
Motorcycle sales in Indonesia, however, fell 11 percent in January, partly because of heavy rainfall. But the overall growth in the sector has benefited finance companies like Adira Finance, Mandiri Tunas and Astra International's Sedaya Finance.
As well as targeting foreign banks, Adira is planning to enter the bond market as part of its financing plans. The company wants to raise Rp 8 trillion by the end of the year with the bond sale making up half that sum.
Rising borrowing costs have failed to deter Indonesian companies from selling bonds.
Bank Indonesia, the country's central bank, raised its benchmark interest rate by 1.75 percentage points last year to 7.50 percent.
Shares of Bank Danamon rose 1.6 percent to Rp 4,165 on the Indonesia Stock Exchange on Tuesday, compared with the 0.4 percent gain in the main stock gauge.
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