Home News Indonesia’s Bank CIMB Niaga Offers US$136M Local Bonds

Indonesia’s Bank CIMB Niaga Offers US$136M Local Bonds

PT Bank CIMB Niaga Tbk (IDX: BNGA) offered local bonds of Rp1.9 trillion or US$135.71 million - Photo: Special.

JAKARTA (TheInsiderStories)PT Bank CIMB Niaga Tbk (IDX: BNGA) offered local bonds of Rp1.9 trillion (US$135.71 million), consisted of sustainable bonds of Rp1.82 trillion and subordinated bonds of Rp83 billion. The bonds will be offered on Dec 12 and listed on 20, 2019, the company announced on Friday (12/13).

It stated, the sustainable bonds are divided three series. Series A has a value of Rp276 billion and an interest rate of 6.5 percent a year with the tenor of 370 days. While series B is a three years bond with an interest rate of 7.55 percent and value of Rp1.06 trillion.

Lastly, series C has a value of Rp481 billion and a 7.8 percent interest rate with five years tenor. While the subordinated bonds has five years tenor and 8.05 percent interest rate.

PT Pemeringkat Efek Indonesia (Pefindo) rated AAA for sustainable bonds and AA for subordinated bonds. While, PT BCA Sekuritas, PT CGS-CIMB Sekuritas Indonesia, PT Danareksa Sekuritas and PT Mandiri Sekuritas are appointed as the underwriters, also PT Bank Permata Tbk (IDX: BNLI) as the trustee.

Earlier, other local banks also issued Rupiah bonds with a total value of Rp1.15 trillion. PT Bank QNB Indonesia Tbk (IDX: BKSW) offered bonds Rp500 billion while other lenders, PT Bank UOB Indonesia, released subordinate bonds Rp650 billion.

Previously, the unit of Qatar’ QNB Group had issued a local bond with an amount of Rp100 billion. For the new emission, as much as Rp450 billion will be issued with a 7.1 percent interest rate and tenure 370 days. The rest of it, Rp50 billion, will be issued with the best effort.

The offering time for the bond issuance on Nov. 20 – 21 and listed on the bourse on Nov. 27. PT Indo Premier Sekuritas acted as the underwriter for the corporate action.

Then, Bank UOB Indonesia offered the Rupiah bond with an interest rate of 9.25 percent and have ten years of tenure. These notes received an AA rating from PT Fitch Ratings Indonesia. Three underwriters namely PT Indo Premier Sekuritas, PT RHB Sekuritas Indonesia and PT UOB Kay Hian Sekuritas helped the issuance.

The bank set the offering period for the bonds on Nov. 8 to be listed at Indonesia Stock Exchange (IDX) on Nov. 14. The funds from the bond issuances will be used to strengthen the capital structure and support the two bank businesses.

The bourse noted there are still 13 companies that will issue bonds until the end of 201. The potential funds from 13 companies’ bonds reached Rp18.22 trillion. Of the 13 companies that will issue bonds, financial service institutions included banks and finance are the most issuers.

Meanwhile, until the end of this year, PT Indonesia Bonds Price Appraisal (IBPA) predicted that the bond issuance will reach Rp130 trillion. The factor that influences the increase of corporate bond issuance is Indonesia’s economic growth that shows stable in around 5 percent. Another factor is the increase in Indonesia’s Sovereign Credit Rating from S&P to BBB/Outlook Stable. Not to mention the cutting of the benchmark interest rate by the Fed.

While next year, IBPA Director Wahyu Trenggono projected corporate bond issuance to reach Rp175 trillion. He said, historically, the condition of the bond market next year is not much different from the past five years or after the general election. Hence, the global market will still affect the corporate bond market next year.

US$1=Rp14,000

Written by Staff Editor, Email: theinsiderstories@gmail.com