Govt to issue global funds US$3 billion for pre-funding

This is the second time the govt issues global bond in SEC-registred format.

REPUBLIKA.CO.ID, JAKARTA -- The government will be issuing government bonds, or Global Bonds, worth US$3 billion in the SEC-registration format for pre-funding in the 2019 budget year. According to a press statement from the Directorate General of Financing and Risk Management at the Ministry of Finance received by Antara here, Tuesday, the Global Bonds comprised three series: RI0224, RI0229, and RI0249.

The RI0224 series amounted to $750 million, with a five-year tenor, maturing on February 11, 2024, and having a coupon rate of 4.45 percent. Meanwhile, nominal issuance of the RI0229 series is set at $1.25 billion, with a 10-year tenor, maturing on February 11, 2029, and has a coupon rate of 4.75 percent.

The RI0249 series is set at $1 billion, with a tenor of 30 years, maturing on February 11, 2049, and has a coupon rate of 5.35 percent. The Government Bonds in foreign exchange received the Baa2 ratings from Moody's, BBB from Standard & Poor's, and BBB from Fitch.

The government has quickly accessed the US dollar market to meet pre-funding in 2019 by considering a conducive market after the G20 meeting. Hence, the final pricing (yield) for each series can be tighter by 27 basis points (bps), 32 bps, and 27 bps from that of the initial price guidance.

The success of this transaction is also the result of the government's consistency in communicating with investors and using a reliable transaction documentation format. This transaction is the government's second issuance of Government Bonds in US dollar denomination using the SEC-Registered Shelf format.

The issuance of Global Bonds demonstrates the government's strong commitment to increase the liquidity of Government Bonds in US dollar denominations. The Government Bonds will be issued on December 11, 2018, and will be listed on the Singapore Stock Exchange and the Frankfurt Stock Exchange.

Meanwhile, the joint book runners in this issuance are ANZ, Citigroup, DBS Bank Ltd., Deutsche Bank, and Goldman Sachs (Singapore) Pte. PT Bahana Securities, PT Danareksa Sekuritas, and PT Trimegah Sekurita Indonesia Tbk. are taking part as the co-managers.

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