The Jakarta Post
Multifinance firm Bussan Auto Finance (BAF) will issue for the first time in 20 years bonds worth Rp 500 billion (US$37 million) that will be used for the firm’s working capital, the company’s top executives said on Thursday.
BAF president director Shinichiro Shimada said it decided to issue the bonds because the market interest rate was low and to diversify the company's funding options.
“The Rp 500 billion bonds will be issued in two series: 370 days tenor with 6.25 percent to 7 percent coupon rates and three years tenor with 7.25 percent to 8 percent coupon rates,” Rayendra L. Tobing, head of investment banking of Indo Premier Sekuritas, said during a press conference in Jakarta.
The bond received an idAA rating from credit rating agency Pemeringkat Efek Indonesia (Pefindo). BAF is planning to receive the effective statement from the Financial Services Authority (OJK) on Oct. 26. Thus, the public offering period is expected to be between Oct. 30 and 31.
The firm engages mainly in new motorcycle financing for the Yamaha brand, which contributes to 90 percent of its total financing. The company also offers sharia refinancing products under BAF Syana.
BAF targets to disburse new loans worth Rp 7 trillion by the end of this year. Up to August, the company disbursed Rp 4 trillion in loans. The company targets to double its net profit this year, from Rp 82 billion in 2016. (bbn)