Indonesia Banks Rush to Raise Funds From Bond Market
Indonesia banking sectors seek to broaden its long-term funding base through the issuance of debt securities those are believed to be cheaper than funding from customer deposits. Total fundraising from bonds market by banks sector year to date has reached IDR5.7trn. That number will increase as some listed banks will get the issuance out soon, among them are Bank Rakyat Indonesia, Tbk (BBRI:IJ), which is currently offering Shelf Registered Bond Tranche III worth IDR4.35trn. The bonds reportedly were oversubscribed by 2.07 times. The pricing for BRI’s new bonds are; 1yr priced at 7.5% (from 7.5%-8% guidance); 3yr at 8.2% (from 8.2%-8.7% guidance); and 5yr at 8.7 % (from 8.7%-9.2% guidance). Besides BRI, there are several more issuers who intend to issue the bonds, they are Bank Mandiri (BMRI:IJ) targets to release at minimum IDR5trn this year and Bank Tabungan Negara (BBTN:IJ) is also recently waiting for a permit from regulator to issue R1trn -IDR3trn bond.
