Govt retail bonds 'well absorbed' with traders asking for more quotas

Agustina Wayansari , The Jakarta Post , Jakarta | Sat, 03/01/2008 12:37 PM | Business

The government said Friday the market was responding well to its latest retail bonds on offer, ORI004, with demand reaching Rp 6 trillion (around US$656 million) as of Thursday.

"We have recorded total requests for some Rp 6.3 trillion as of Feb. 28, with several traders asking for increased quotas," the Finance Ministry's director general of debt management, Rachmat Waluyanto, said.

"Bank Mandiri, for example, has requested Rp 750 billion on top of its initial quota of Rp 1.5 trillion, while securities company PT Trimegah Sekuritas has asked for an additional Rp 100 billion."

The offer opened Feb. 25 and will last until March 6.

The bond is expected to be officially listed on the Indonesian Stock Exchange (IDX) on March 13.

This latest offer is the fourth retail bond the government has released. The first was issued in 2006 when the government sold some Rp 3.8 trillion worth of bonds.

In the second and third offerings, the government sold Rp 6.23 trillion and Rp 9.3 trillion, respectively.

The government has been issuing bonds in both U.S. dollars and rupiah denominations to help finance the state budget deficit.

This year, the government hopes to raise some Rp 91.6 trillion from bond sales. So far, up to Rp 31.2 trillion worth of bonds have been sold.

The government worked with the Indonesian Stock Exchange to promote the bonds in more than 20 cities across the country, and 15 banks and three security companies worked to market the product, Rachmat said.

IDX president director Erry Firmansyah said the bourse expected the issue to push the bond market's daily transactions from Rp 163 billion at present to more than Rp 200 billion.