JAKARTA: Indonesia completed its largest-ever global sukuk offer, selling US$2 billion of the debt at the lowest yield in three years.
The Finance Ministry issued the dollar notes at 4.325 per cent, lower than its initial indication of 4.55 per cent, Robert Pakpahan, director general at the budget financing and risk management office at the ministry, said in a text message on Friday. That compares with the 4.35 per cent rate paid on similar Shariah-compliant debt sold last year and the record-low 3.3 per cent on 10-year sukuk issued in 2012.
Standard & Poor’s, which ranks Indonesia at the highest junk level, raised its outlook on the nation’s credit rating to positive from stable on Thursday, citing policy framework improvements and enhanced monetary and financial management. Hong Kong ended a roadshow for a planned sale of Shariah-compliant dollar notes on Thursday, while PT Garuda Indonesia, the country’s state-controlled airline, is meeting investors to market an upcoming greenback-denominated sukuk issue.
“Demand for sukuk is increasing globally,” Pakpahan said from Jakarta. “Our gross issuance has also increased this year, compared to last year,” so the government decided to raise a larger amount from Islamic bonds, he said.
