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Tuesday, January 26, 2010

SUN auction oversubscribed to 2.17 times, SR-002 has been sold for 49.33% from indicative target

BI / bursa
21/1/10
By Irvin Avriano A.
for Bisnis Indonesia

SUN auction oversubscribed to 2.17 times, SR-002 has been sold for 49.33% from indicative target

JAKARTA: Government bond (surat utang negara/SUN) auction, which was held yesterday, oversubscribed 2.17 times of the indicative target set, or Rp10. 87 trillion from the indicative target of Rp 5 trillion.

Based on the Departement of Finance press release yesterday, the government released four series of SUN worth Rp5.45 trillion to investors. Series that are auctioned are series SPN20110113 which will mature next year, the FR0031 maturing in 2020, the FR0040 maturing in 2025, and the FR0050 maturing in 2038.Justify Full
Director General of Debt Management Office Department of Finance Rahmat Waluyanto said the results of auction shows some positive sentiment from rating action held by Fitch Ratings.

"The interest for SUN by the foreign investor still high in the middle of correction happens in global forex and stock market," he said in short message service yesterday.

He said the ownership of SUN by the off-shore investors is still high, even grow to a little higher level in the last week.

Data from Department of Finance shows that the foreign ownership in SUN grow to level IDR 113.89 trillion at the last weekend from level IDR113.22 trillion in January 15th.

Economist of PT Bank Danamon Indonesia Tbk Helmi Arman said yield rate that given by government to investors yesterday were still in the range of what he predicted before the auction.

"Almost all the yield given is in range with the prediction, there is not too big spread with the price that formed in the secondary bond market," he said yesterday.

Previously, Helmi predict the series SPN20110113 will be released by the government on yield in the range 6.75% - 6.84%, FR0031 at level 9.65% - 9.81%, FR0040 at the level of 10.46% -10.62%, and FR0050 at the level of 10.75% -10.9%.

Auction results at odds with the predictions thin set Helmi is on SPN20110113 series released by the government to yield 6.85%. The rest, yield released into the predictions.

At the auction, the government is getting requests for series SPN20110113 as much as Rp2, 29 trillion, FR0031 Rp4, 16 trillion, FR0040 Rp2, 86 trillion, and FR0050 Rp1, 55 trillion.

Helmi added bond market conditions are still affected by the euphoria of increased ratings of long-term debt of Indonesian government. Long-term debt ratings of foreign and local denominations Indonesia upgraded by Fitch Ratings from the BB level to BB+ earlier this week.

According to him, the ratings issue will result in positive sentiment in the long term to Indonesian sovereign bond market, and will enough to help ease the pressure of negative sentiment from tightening plan investment policy of US banks and liquidity tightening plan in China.

Retail sukuk
Rahmat said the results of retail sharia bond (surat berharga syariah negara/SBSN/sukuk) 002 series (SR-002) sales for two days was reached IDR1.48 trillion, or equals with 49.33% from the government's indicative target worth IDR3 trillion.

The coupon of SR-002 set in the level 8.7% and will mature in three years in February 10th 2013. The minimum purchase was limited by the government as much as IDR5 million, but they don't set the maximum purchasing limit.

The retail sukuk sells by 18 selling agent starting in Monday January 25th and will end next weekend in February 5th. The selling agent includes the biggest government-owned bank PT Bank Mandiri Tbk and nine other national bank. The marketing also done by eight securities company including state-owned securities company PT Danareksa Sekuritas and PT Bahana Securities.

Director of Sharia Financing Directorate General Debt Management Office DoF Dahlan Siamat said he was optimistic with the marketing result of SR-002. "We believed the sukri [sukuk retail/SR-002] demand will be oversubscribed."

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