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🇮🇩 Indonesia /Economy & Trade

Indonesia's Investor Confidence High as Danantara Bond Soars

From Republika · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

News Sources not specified New plan
  • Indonesian company Danantara Indonesia successfully issued a global bond, raising $1.5 billion USD.
  • The bond issuance was oversubscribed by more than three times, indicating strong global investor confidence in Indonesia.
  • Proceeds from the bond will be used for company development, with competitive interest rates achieved despite global economic uncertainty.

CEO of Danantara Indonesia, Rosan Roeslani, declared that global investor confidence in Indonesia remains robust, evidenced by the overwhelming demand for Danantara Indonesia's debut U.S. dollar-denominated global bond. The issuance, initially targeting $1 billion USD, saw demand surge to $4.6 billion USD, prompting an increase in the final issuance to $1.5 billion USD.

I convey the market's confidence, the outside world's confidence in Indonesia is very good.

— Rosan RoeslaniCEO of Danantara Indonesia, commenting on the success of the global bond issuance.

Roeslani highlighted that the oversubscription, exceeding three times the target, demonstrates significant international market trust in Indonesia's economic prospects. This success was achieved amidst global economic uncertainty, geopolitical tensions, and domestic financial market pressures. "This is a very good result and it proves that investor confidence in Indonesia is high. And this is real," Roeslani stated.

From the plan of 1 billion dollars that we wanted to achieve, the book building that came in was approximately 4.6 billion dollars. So we finally increased the issuance to 1.5 billion dollars.

— Rosan RoeslaniExplaining the oversubscription and final issuance amount of the global bond.

The bond was split into $750 million USD each for five-year and 10-year tenors. Notably, the coupon rates achieved were below initial market expectations. The five-year bonds were priced at 5.35 percent, and the 10-year bonds at 5.95 percent. Roeslani explained that some parties had anticipated higher yields would be necessary to attract investors, but the strong market interest allowed for competitive rates.

This is a very good result and it proves that investor confidence in Indonesia is high. And this is real.

— Rosan RoeslaniStating the significance of the bond issuance's success.

Investor confidence was further reflected in the buyer composition, dominated by investors from the United States and Europe. For the five-year bonds, 38 percent were from the U.S., 41 percent from Europe and the Middle East, and 21 percent from Asia. The 10-year bonds saw U.S. investors taking the largest share at 52 percent, followed by Europe and the Middle East.

If they didn't trust us, they would definitely ask for a very high premium yield. They didn't ask for this, and we even see the yield is very competitive.

— Rosan RoeslaniDiscussing the competitive interest rates achieved on the bonds.
DistantNews Editorial

Originally published by Republika in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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