Indonesia's Samurai Bonds Received "Extremely Well" by Market
According to a statement of Indonesia's Finance Ministry, Indonesia raised a total of 100 billion yen (approx. USD $901 million) from the issuance of three, five and seven-year Samurai bonds (yen-denominated bonds) on Wednesday (31/05). The issuance, Indonesia's first public sale of Samurai bonds, was led by Mizuho, Nomura and SMBC Nikko.
Indonesia's Finance Ministry stated that the issuance was extremely well received by the market, including new investors such as asset management and pension funds.
The sale involved three-, five- and seven-year maturities with coupon rates of 0.65 percent, 0.89 percent and 1.04 percent, respectively.
In 2016 the Indonesian government had already sold Samurai bonds through a private placement. Back then it involved 3-year maturities, sold with a 0.83 percent coupon rate, and 5-year bonds sold at 1.16 percent. It attracted only about half the amount of bids compared to the latest Samurai bond deal.
After Standard & Poor's upgraded Indonesia's sovereign ratings to investment grade earlier this month, Indonesia now has investment grade status from all key three credit rating agencies. This should open up a pool of capital inflows from conservative investors.
Samurai Bond Sale Indonesia (31 May 2017):
| Maturity | Amount (yen) |
Coupon | Bps spread over Yen Offer-Side Swap |
| 3-year | 40 billion | 0.65% | 55 |
| 5-year | 50 billion | 0.89% | 75 |
| 7-year | 10 billion | 1.04% | 85 |
Source: Finance Ministry Indonesia
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