The government, in this case the Indonesian Ministry of Finance, managed to set a record by issuing Global Sukuk worth 2.75 billion US dollars or around Rp 42.9 trillion. This transaction shows the high confidence of global investors in Indonesia's economic fundamentals, while supporting the financing of the 2025 State Budget (APBN).
“This transaction succeeded in attracting investor interest with orders reaching 4.9 billion US dollars, or more than 1.8 times the issuance target,” wrote the Directorate General of Financing and Risk Management of the Indonesian Ministry of Finance in its official statement quoted on Wednesday (20/11/2024).
The greatest interest in Indonesia's global sukuk came from Middle Eastern, Malaysian, and Brunei investors. As for the best-selling Global Sukuk with a tenor of 5.5 years, as much as 61 percent was allocated to investors in the region.It is known, this Global Sukuk was issued in three tenors. For a 5.5-year tenor, the government issued 1.1 billion US dollars or around Rp17.16 trillion which will mature in 2030. Furthermore, for the 10-year tenor, 900 million US dollars or around Rp 14.04 trillion was issued with a maturity date of 2034. Finally, a 30-year tenor was issued amounting to 750 million US dollars or around Rp 11.7 trillion with a maturity date of 2054.
The yield levels of this issuance are 5.00 percent for a 5.5-year tenor, 5.25 percent for a 10-year tenor, and 5.65 percent for a 30-year tenor. These figures are lower than the initial price guidance, reflecting the high confidence of the global market in Indonesia's economic stability.
The issuance of this Global Sukuk uses a Wakalah contract structure that has obtained a sharia opinion from the National Sharia Council of the Indonesian Ulema Council (DSN-MUI) and several other international sharia institutions. The sukuk will be listed on Singapore Exchange Securities Trading Limited and NASDAQ Dubai with investment ratings of Baa2 from Moody's, BBB from S&P, and Fitch.
This issuance is one of the largest in Southeast Asia in 2024. With the total issuance of Global Sukuk so far this year reaching US$5.1 billion, the government has set a new record in the history of US dollar-based sukuk issuance. The transaction was managed by Deutsche Bank, Dubai Islamic Bank, JP Morgan, KFH Capital, and Standard Chartered Bank as joint lead managers, with PT BRI Danareksa Sekuritas and PT Trimegah Sekuritas Indonesia Tbk as co-managers.
