BDNI to launch mutual fund

JAKARTA (JP): The Capital Market Supervisory Agency (Bapepam) granted a license yesterday to the country's first open-end mutual fund, which will be called the Reksa Dana Money Market Fund (MMF) and sponsored by Bank Dagang Nasional Indonesia and PT BDNI Securities.

Reksa Dana MMF will offer 500 million shares to be priced at Rp 1,000 (42 U.S. cents) each starting July 5. The share price will be adjusted on a daily basis according to the fund's net asset value.

A Bank Dagang Nasional Indonesia director, R.M. Hariandja, said that BDNI Securities has been appointed as fund manager and ABN AMRO Bank as the custodian bank.

Hariandja said that total funds collected by Reksa Dana MMF will be invested in fixed income instruments including time deposits, bank savings, Bank Indonesia certificates, commercial papers and debt instruments which have a maturity of a maximum of two years.

A director at BDNI Securities, Lid da Lopez, said that the minimum initial order is set at 500 shares worth Rp 500,000.

Commenting on the fund's investment policy, Hariandja said that in addition to the business motive, the establishment of Reksa Dana MMF also has an education mission.

"We want to offer a safe investment to investors, which is possible because the money market offers a fixed return," Lopez said.

"Later, we may also set up other funds which operate in the equity market," he added.

Meanwhile, Bapepam's chairman, I Putu Gede Ary Suta, hailed the establishment of Reksa Dana MMF. He asked the fund's management to expand its distribution network, because, he said, the mission of a mutual fund is to expand the capital market's retail investor base.

Lopez said the new fund will handle distribution through BDNI's more than 50 outlets throughout country.

Bank Dagang Nasional Indonesia is the founder of Indonesia's first and only closed-end mutual fund -- PT BDNI Reksa Dana -- which manages approximately Rp 350 billion in funds and is listed on the Jakarta Stock Exchange.

Unlike the closed-end fund, the open-end mutual fund is not listed on a stock exchange and it, therefore, must buy back the shares on a demand basis. (alo)