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PLN secures US$1.18b syndicated loan for 35,000 MW program
The funds would be used to build electricity infrastructure that is part of PLN's 35,000 MW program, such as substations and transmissions.
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Workers are seen at a substation project in Tanjung Karang, Mataram, West Nusa Tenggara, on Sept. 25, 2018. (Antara/Ahmad Subaidi)
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tate electricity firm PLN has secured Rp 16.75 trillion (US$ 1.18 billion) in syndicated loans from seven local financial institutions to finance the construction of its flagship 35,000 megawatt (MW) electricity program.
PLN announced on Tuesday that the loan was divided into two schemes, with Rp 13.25 trillion offered through a conventional loan scheme and Rp 3.5 trillion under a shariah scheme.
Both have a 10-year tenor.
The syndicated loan, which was inked at the PLN head office in Jakarta on Tuesday, will come from state-owned lender PT Bank Rakyat Indonesia (BRI), state-owned lender Bank Mandiri, private lender PT Bank Central Asia (BCA), private lender CIMB Niaga, state-owned financial institution PT Sarana Multi Infrastruktur (SMI), as well as sharia-based lenders PT BNI Syariah and PT BCA Syariah.
PLN finance director Sarwono Sudarto said the funds would be used to build electricity infrastructure that is part of the 35,000 MW program, such as substations and transmissions.
"The cost of funds is competitive and the loan will boost our rupiah loan portfolio,” he said in a statement, adding that the loan scheme was the “perfect way” for PLN to get funding as the company had to tighten its budget while still fulfilling increasing electricity demand.
“This is why we are always keen on forging a partnership with either banks or non-banks to fund our electricity projects. This successful partnership will also deepen investors' confidence in Indonesia."
The $1.18 billion loan was PLN’s second corporate action in six months after the firm announced in November 2018 that it had obtained a syndicated loan worth $1.62 billion from 20 international banks.
The November loan was also used to finance projects in the 35,000-MW program. (bbn)
