Citibank Appointed As Joint Leas Bookrunners Tuk Sukuk
By : Wiyanto And Aldo Bella Putra | Tuesday, March 20 2018 - 14:00 IWST
Citibank (Foto Dok Industry.co.id)
INDUSTRY.co.id - Jakarta- Citi recently gained the trust of the Ministry of Finance of the Republic of Indonesia ("Republic") as Joint Lead Bookrunners for the issuance of US $ 3 billion dual tranche bonds consisting of Green Sukuk 5 years worth US $ 1.25 billion and Sukuk 10 year worth of US $ 1.75 billion.
The 5-year Sukuk and the 10-year Sukuk were held on February 22, 2018 with yields of 3.750% and 4.400%, respectively. Each tranche has been rated Baa3 by Moody's Investors Service, BBB- by S & P Global Ratings and BBB by Fitch Ratings.
The 5-year Green Sukuk published by the Republic of Indonesia is the world's first Green Sukuk government, and is published under the new Green Bond and Green Sukuk Frameworks implemented in Indonesia. This publication also makes Indonesia the first country in Asia to offer the government's Green Bond.
CEO of Citi Indonesia Batara Sianturi, said, "Citi continues to deliver content and solutions to support Indonesia's economic growth. The first launch of Green Sukuk Indonesia's government is not just a development of the existing growth rate, but also a milestone for Indonesia. Globally spread across over 160 countries and jurisdictions, Citi has a strong position to target potential investors who are now beginning to show a high interest in environmentally friendly investment instruments in Indonesia, he said on Tuesday (20/3/2018).
Managing Director, Head of Corporate and Investment Banking of Citi Indonesia Gioshia Ralie added, "Citi is committed to leveraging its extensive and deep experience to provide the best for the Ministry of Finance and Indonesia The fact that Indonesia continues to be one of Asia's leading issuers with credit ratings that will provide a significant momentum for Green Sukuk's future success."
Giosha continued, "Currently, there is increasing volatility in global capital markets due to expectations of inflation and interest rate hikes in the US since early 2018. Therefore, now is the right time for Indonesia to take advantage of this opportunity."
This issuance of government bonds reflects high global investor interest and has strengthened the resilience and depth of the Sukuk market which is a sign of investor confidence in Indonesia's economic fundamentals. The Indonesian government succeeded in obtaining a lower interest rate of 30 bps than the initial preliminary price guidance for both tranches, reflecting strong investor interest in the issuance of Indonesian government bonds. This is the ninth dollar Sukuk issuance by the Government of Indonesia, and the seventh publication under the Trust Certificate Issuance program. In addition, Sukuk issuance is also in line with Indonesia's goal to strengthen global Islamic financial markets and to demonstrate Indonesia's commitment to sustainable eco-friendly financing.