Indonesia raises Rp 913b
from Islamic bonds

Islamic bonds offered by the Indonesian government in Tuesday’s auction are more than five-times oversubscribed, an official says. Incoming bids for the bonds, commonly known as sukuk, topped Rp 2.65 trillion (US$275.18 million) while the Finance Ministry’s debt management office only hoped to raise only Rp 500 billion through the offering.

Dahlan Siamat, director of Islamic financing policy, said that the government successfully floated Rp 913 billion of sukuk in the offering: Rp 640 billion from six-year notes (PBS001) and Rp 273 billion from 25-year notes (PBS004).

“We will not hold another auction for domestic sukuk in the next month as we have already met our 2012 target for the domestic sukuk,” he told The Jakarta Post.

The weighted average yield for the the six-year notes and the 25-year notes were 6.0100 percent and 6.8098 percent, respectively. Meanwhile, there were no winning bids for six-month Islamic treasury bills, despite received bids of Rp 921 billion.

The Finance Ministry’s debt management office so far has raised Rp 47.5 trillion from Islamic bonds, but targeted at least Rp 57 trillion to finance the deficit in the 2012 state budget.

“To meet the target, we plan to raise the remaining funds from the global sukuk [Islamic bonds offered in foreign currency] by the end of this year,” added Dahlan. (sat)

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