BNI Seeks IDR 7.2 Trillion From Bond Issuance, What For The Fund?

BNI Bank Building. (Photo: Doc. Antara)

JAKARTA - PT Bank Negara Indonesia (Persero) Tbk (BNI) has completed a roadshow and pricing in connection with the plan to issue BNI Tier 2 Capital Bonds 2021 amounting to US $ 500 million or the equivalent of Rp7.2 trillion (exchange rate of Rp.14,400 per US dollar), at 23 March 2021.

The bonds issuance with an interest rate of 3.75 percent per year refers to the provisions of Regulation S (Reg S) based on the US Securities Act, which will be listed on the Singapore Stock Exchange.

"Bonds, if issued will be the company's first issuance based on the Euro Medium Term Note program (EMTN program) which was formed on May 6, 2020, then renewed on March 22, 2021. Based on the EMTN program, the company can issue debt securities in stages with a total principal as much as 2 billion US dollars, "wrote BNI Corporate Secretary Mucharom in an information disclosure on the Indonesia Stock Exchange (IDX) website, quoted on Thursday, March 25.

In connection with the issuance of debt securities and the renewal of the EMTN Program, the company has signed the transaction documents. Among them are the Amended and Restated Trust Deed with The Hongkong and Shanghai Banking Corporation Limited, as Trustee on March 22, 2021.

Then, the Amended and Restated Agency Agreement with the Trustee, The Hongkong and Shanghai Banking Corporation Limited, as the Issuing and Paying Agent, Transfer Agent and Registrar, and Counting Agent, on March 22, 2021.

Amended and Restated Dealer Agreement with Citigroup Global Markets Limited and The Hongkong and Shanghai Banking Corporation Limited, as Arrangers and Seller on March 22, 2021.

Also, the Subscription Agreement between Citigroup Global Markets Limited and The Hongkong and Shanghai Banking Corporation Limited as manager, dated March 23, 2021, and the Pricing Supplement dated March 23, 2021.

"The proceeds from the plan to issue debt securities will be used for corporate financing and general funding," wrote the state-owned bank management.

The formation and plan to issue bonds will have a positive impact on the company's financial condition. BNI plans to complete the issuance of debt securities within 5 working days after pricing, namely on March 30, 2021.

This Bond Offer is not a public offering in Indonesia as referred to in Law No. 8 of 1995 concerning the Capital Market and its implementing regulations.

The plan to issue bonds has a value of less than 20 percent of the company's equity based on the Company's Financial Statements as of December 31, 2020 which has been audited by KAP Purwantono, Sungkoro & Surja (a member of Ernst & Young Global Limited) as an independent auditor, and therefore not a Material Transaction as OJK Regulation No.17 / POJK.04 / 2020 concerning Material Transactions and Changes in Business Activities.