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Tuesday, February 22, 2011

First municipal bond will issued IDR1.8 trio

BI/bursa
22/2/2011
Irvin Avriano A.

First municipal bond will issued IDR1.8 trio

JAKARTA: One of a local government in Java island intends to issue nearly IDR1.8 trillion municipal bond.

PT Pemeringkat Efek Indonesia (Pefindo) Director Salyadi Saputra said that the process is already in a rating phase.

“The exact amount is around IDR1.8 trillion, yet we cannot mention which province will issue such bonds,” he said to the press after the launch of Pefindo’s new office this afternoon.

According to Salyadi, the corporate action has not yet been conducted at the moment as the limited interest from the local government to seek financing in the capital market.

One of a country whose municipal bonds are relatively developed is US. In US, the municipal bonds transaction in the secondary market reaches huge amount.

He said that several other local governments also are reviewing the plan to assess their financial condition through a program namely financial management assessment (FME) by Pefindo.

Pefindo President Director Ronald Tauviek Andi Kasim added that such FME had been conducted by two local governments in the Central and Eastern Indonesia.

Yet, it is not certain if those two local governments shall appoint Pefindo as the partner in the FME program. The FME program was first sparked by World Bank, thus it is still in the middle of tender process with other rating agencies.

“FME aims to identify the strength of a region. Hopefully the tender process will be completed by March,” he said.

Besides Pefindo, the other rating agencies operating in Indonesia are PT ICRA Indonesia and PT Fitch Ratings Indonesia. (T01/wiw)

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