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LPEI to offer Rp 3.5t bonds in September
The Indonesian Export Financing Agency (LPEI) is preparing to hold its third bond issuance this year as it aims to reap Rp 3
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The Indonesian Export Financing Agency (LPEI) is preparing to hold its third bond issuance this year as it aims to reap Rp 3.5 trillion (US$296.54 million) to finance various exports.
The bond issuance will take place between September and October, and will complete the agency's full-year bonds plan, from which it aims to raise Rp 8 trillion, according to LPEI finance director Basuki Setyadjid.
The first bond issuance, worth Rp 4 trillion, took place in May, and the second issuance, worth Rp 500 billion, was conducted in July.
'We are planning to generate the rest of the targeted funds in a single issuance, unless we receive interest from individual investors,' Basuki said recently.
'If that is the case, we will set aside Rp 500 billion for them and generate Rp 3 trillion from the usual bond issuance.'
The agency ' also known as the Indonesia Eximbank and is wholly owned by the government ' has not officially decided on the underwriters for the bond issuance.
All proceeds will be used to fund this year's financing needs even though LPEI has already surpassed its 2014 financing target by the end of June.
Its business plan shows that the full-year target of financing is set at Rp 44.69 trillion, but LPEI has already booked Rp 45.91 trillion in financing in the first half.
According to LPEI senior managing director Arifin Indra Sulistyanto, it will not make a revision to its business plan and carry out operations as usual.
The LPEI was created in 2009 and is tasked with providing loans to help support local export-oriented business and overseas business that will eventually boost Indonesia's own exports.
In addition to financing, it also provides business guarantees, insurance and advisory services.
LPEI managing director Dwi Wahyudi said it was in talks to provide overseas financing, including to Myanmar.
'Myanmar is interested in purchasing our Anoa [Indonesian-made armored personnel carrier]. We have begun talks over the financing scheme,' he said.
He added that Taiwan had expressed interest as well in purchasing CN-235 aircraft, which are produced by state-owned aircraft maker PT Dirgantara Indonesia.
Besides vehicle-related financing, LPEI is also preparing to provide financing for its fourth smelter this year.
It has previously provided similar facilities to PT Sulawesi Mining Investment for its nickel smelter in Morowali, Central Sulawesi; PT Indoferro for its iron smelter in Cilegon, Banten; and PT Aneka Tambang for its ferronickel smelter in Pomalaa, Southeast Sulawesi.
'Financing will be disbursed to support the operations of a smelter owned by the Modern Group in Sulawesi. We have not come up with the final figure, but it will be similar to the facility we channeled to Indoferro,' Dwi added.
Data from LPEI revealed that it channeled up to $65 million for Indoferro's smelter.
Meanwhile, according to LPEI's latest financial report, the agency posted Rp 509.03 billion in net profit in the first half, rising by more than half from what it recorded during the same period in 2013. Its net interest margin rose 58 basis points year-on-year to stand at 3.67 percent.
Its total assets amounted to Rp 53.34 trillion by June. Its liabilities and equities reached Rp 44.55 trillion and Rp 8.79 trillion, respectively.
