GOVT ISSUES SAMURAI BONDS WORTH 35 BILLION YEN

Jakarta, July 29 (ANTARA) - The Indonesian government on Wednesday issued for the first time Samurai bonds worth a total of 35 billion yen after their price was fixed on July 17, 2009, a finance ministry official said.

Finance Ministry spokesman Harry Z. Soeratin said here on Wednesday the Indonesian government's bonds were issued in the Japanese market with a guarantee facility from the Japan Bank for International Cooperation (JBIC).

He said the government had set the total value of the bonds at 35 billion yen with a grace period of 10 years.

The decision was made after considering a number of matters, including the need to explore market expansion basis for the government state debentures (SUN) in the Japanese financial market.

Besides, the government also considered the relatively conducive domestic market condition so that it was expected to be able to absorb the remaining SUNs issued this year.

This is in line with the government's policy to give priority to domestic financing sources. "It is also based on a consideration to maximize the utilization of the JBIC guarantee facility the Japanese bank had made available until 2010," Harry said.

The government fixed the coupon rate of the bonds at 2.73 percent with a price at par. The format of its issuance is private placement with limited qualified institutional investors, including insurance and other financial institutions in Japan.

Serving as the joint lead arrangers in the transaction were Nomura Securities, Daiwa Securities SMBC and Mitsubishi UFJ Securities.