Govt plans to issue Rp 3t in bonds

Govt plans to issue Rp 3t in bonds

The Jakarta Post, Jakarta

The government said on Monday it expected to sell Rp 3 trillion
(US$327.86 million) worth of domestic bonds later this month in
order to help cover the 2004 state budget deficit.

"We set the indicative amount at Rp 3 trillion due to the
relatively favorable market conditions now. Last month we
initially targeted to sell Rp 2.5 trillion worth of bonds, but we
ended up issuing Rp 3.75 trillion to meet strong demand from
investors," the director general of the state treasury at the
Ministry of Finance, Mulia Nasution, said.

The FR0025 series bonds, which will be auctioned by the
central bank on Oct. 26, will have a fixed coupon rate of 10
percent and will mature on Oct. 15, 2011.

The nominal value for a single bond has been set at Rp 1
million, with coupons to be regularly paid twice a year, on April
15 and Oct. 15.

The government hopes to issue about Rp 23 trillion worth of
rupiah-denominated bonds this year to help finance the budget
deficit, which is estimated at Rp 26.3 trillion, or 1.3 percent
of gross domestic product.

So far this year, the government has sold Rp 17.7 trillion of
domestic bonds.

Demand for government bonds has risen over the past few
months, in what many say is a sign of growing investor confidence
in the country's economy.