Govt to issue Rp2t in T-bills next month
Govt to issue Rp2t in T-bills next month
Urip Hudiono
The Jakarta Post/Jakarta
The government plans to offer up to Rp 2 trillion (about US$215
million) in one-year treasury bills, or T-bills, next month,
according to a finance ministry official.
Director General of State Treasury Mulia Nasution said on
Tuesday the auction of the short-term promissory notes would take
place in April, after the planned sale of dollar-dominated
overseas bonds slated for later this month.
"We are planning at least four offerings of treasury bills
throughout the year," he said, adding that the government hopes
to reap as much as Rp 2 trillion from each of the offerings.
"We will not be offering too many bills at first, probably the
same as usual," he said.
"But if the market demand turns out to be good, we hope to
sell even more."
Treasury bills are short-term promissory notes that mature in
one, three or 12 months.
The government has been offering both rupiah- and dollar-
denominated bonds -- both of which mature within a year, to help
redeem maturing debts and help finance the budget deficit, which
is estimated to reach about 1 percent of gross domestic product
(GDP) this year.
The government sold Rp 8 trillion worth of bonds in its two
first local bond offerings this year.
Later this month, the government will offer between $1 billion
to $1.5 billion worth of bonds, having appointed Citigroup,
Deutsche Bank AG and UBS AG as the bonds' underwriters earlier
this year.
The introduction of treasury bills will complete the
government's bond offerings and help expand the local bond market
as investors are likely to consider the bills more attractive
than treasury bonds.
The government plans to sell a total of Rp 43 trillion worth
of domestic bonds and bills this year. Last year, it sold Rp 32.5
trillion worth of bonds, including $1 billion in global bonds.
"How many treasury bills we offer will be determined by how
much we get from our usual local bond and global bond offerings,"
Mulia said.
Market analysts predict that government bond issues this year
will do well, in part due to the country's steadily improving
economy as reflected in the recent upgrading of its debt ratings.
Global rating agency Moody's recently upgraded its outlook for
Indonesia's current B2 long-term local currency rating -- which
is still five levels below the investment grade -- to "positive"
from "stable".
Fitch Ratings also raised Indonesia's long-term foreign and
local currency ratings to BB- from B+, and affirmed its short-
term rating at B, both with positive outlooks.
Standard and Poor's, meanwhile, upgraded Indonesia's long-term
foreign currency to B+ from a B and the local currency rating to
BB from B+, all with positive outlooks.