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ublicly listed tower company PT Tower Bersama Infrastructure (TBIG) recently issued US-denominated bonds to refinance its debts, with the firm claiming to have complied with a new regulation on foreign-denominated loans set by the central bank.

TBIG finance director Helmy Yusman Santoso said on Thursday that his firm had issued US$350 million in global bonds in full compliance with a new regulation issued by Bank Indonesia (BI).

'€œWe are aware of the regulation and [issuing] the global bonds is okay,'€ he told The Jakarta Post.

In January, BI imposed a new regulation requiring all Indonesian companies planning to borrow dollars to meet minimum standards in three areas: liquidity strength, hedging ratio and credit-rating level.

Under the new regulation, companies will be required to hedge at least 20 percent of their short-term dollar debts and to have a liquidity ratio of 50 percent.

The requirements will become stricter next year, when the hedging ratio will be increased to 25 percent and the liquidity ratio raised to 70 percent.

In addition, starting early next year, all companies seeking to borrow dollars must have a minimum rating of BB from international rating agencies. The rating rule, however, exempts companies that borrow dollars for infrastructure projects.

TBIG complied with all aspects of the regulation prior to the enforcement of the regulation, Helmy said.

'€œWe have also hedged 100 percent of our foreign-denominated debts ['€¦],'€ he said.

As of September last year, TBIG'€™s gross loans hit Rp 14.8 trillion ($1.2 billion), while its cash and cash equivalents stood at Rp 578.9 billion. The firm'€™s debt-to-equity ratio reached around 4 in the same period last year.

A number of analysts have predicted growth in the domestic tower-building business, promising TBIG good business prospects.

Helmi added that its $350 million bonds had been rated BB by Fitch Ratings and Standard & Poor'€™s ratings agencies.

On Tuesday, the tower company offered $350 million in bonds through its wholly owned subsidiary, TBG Global Pte. Ltd.

The bonds, dubbed Surat Utang 2022, will mature in 2022, with coupon rate of 5.25 percent. The bonds will be listed on the Singapore Stock Exchange (SGX).

'€œWe opted for US dollar-denominated bonds because they have better liquidity than rupiah-denominated bonds,'€ Helmy said.

If the bonds were converted into rupiah, they would be around Rp 4.3 trillion, which is quite difficult to get through the issuance of rupiah bonds, he went on.

In a statement, TBIG said it would raise a total of $345.3 million from its global bond issuance deductions for possible expenses.

TBIG plans to use the raised funds to refinance its revolving-loan facility worth $300 million, while the remainder will be used to pay debts maturing in November this year.

Previously, on Nov. 21 last year, the firm secured $1.3 billion in syndicated loans from 11 banks. From the total amount of loans, $900 million was used for debt refinancing, while the remaining $400 million was allocated for capital expenditure this year.