Attractive coupons, investors are interested in FR96 and FR97. The two series of 10-year and 20-year benchmark candidates recorded bids of up to IDR 17.8 trillion and IDR 9.3 trillion, surpassing the other series between IDR 1.2 trillion to IDR 6.5 trillion in yesterday’s SUN auction. Meanwhile, FR96 and FR97 each have coupons of 7.00% and 7.125%. Finally, the government won this auction for a total of IDR 19 trillion out of a total incoming bid of IDR 47.2 trillion.
Corporate Bonds
KB Bukopin Gets a Social Bond Loan from IFC in the Value of IDR 4.4 Trillion. KB Bukopin, Tbk signed a social bond financing cooperation agreement with the International Finance Corporation (IFC). Through this agreement, IFC is committed to providing loans totaling USD 300 million or equivalent to IDR 4.41 trillion to KB Bukopin. The USD 300 million loan will be used to help the Indonesian people, especially in the fields of education, the environment, and information technology, to recover. (Tempo)
Domestic Issue
Government Absorbs IDR 19 Trillion in SUN Auction. Investors’ interest in investing in government bonds (SUN) is quite high. Bids entered in the SUN auction on Tuesday (30/8) reached IDR 47.24 trillion. DJPPR noted that bids entered in the SUN auction reached 2.49 times the indicative target. Taking into account the reasonable yield of SBN in the secondary market and the planned financing needs for 2022, the government decided to win the demand of IDR 19 trillion or according to the announced indicative target. (Kontan)
Recommendation
With a tug of war the amount of the price increase in subsidized fuel. Investors are beginning to observe the positive impact of shifting fuel subsidies to more productive sectors. Meanwhile, part of the fuel subsidies will be used by the government to finance three social assistances worth a total of IDR 24.2 trillion, with the hope of reducing the burden due to rising inflationary pressures.
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