Debt & equity market highlights

PT Bank Lippo Tbk finally listed the US$200 million bond arranged by UBS in Singapore Stock Exchange. The proceeds would be used to finance the bank's commercial and consumer lending, and strengthen its capital.

Meanwhile, PT Bank Negara Indonesia Tbk had secured US$150 million syndicated loan from 12 banks & financial institutions to refinance debts. ABN Amro, Bano of Tokyo Mitsubishi UFJ, State Bank of India, Burgan Bank- Kuwait, The Arab Investment Company, Bank Muscat, National Bank of Dubai, Shanghai & Commercial Savings Bank, Mizuho & Standard Chartered are members of the syndication.
Pakuwon Jati Finance BV, a wholly-owned subsidiary of property company PT Pakuwon Jati Tbk registered in Amsterdam, Netherland, had issued US$110 million bond (12%, maturity 2011). The bond, listed in Singapore Stock Exchange, would be used to refinance debts and finance the acquisition of PT Artisan Wahyu.

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SCB-Mizuho-ABN Amro arrange U$150 million loan for BNI

State-owned bank PT Bank Negara Indonesia (BNI) Tbk has appointed Standard Chartered Bank, Mizuho, and ABN Amro as arrangers to raise US$150 million loan to refinance its debts and support expansion programs, Antara reported.

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ABN pulled out from Bukopin IPO

Poor international market respond had pushed ABN Amro out from underwriting the IPO of PT Bank Bukopin Tbk. Local investors might be the saviour.

ABN Amro is reportedly had written a letter to Bukopin management yesterday about the pull out decision. None of ABN Amro and Bukopin executives in Jakarta available for comment.
But people close to the bookbuilding process claimed an oversubscription from local investors.
Today is the closing of bookbuilding process (extended from June 16) for Bukopin shares which initially expecting to raise Rp2 trillion. But the fall of stock market in the last few weeks had cost the company's IPO with most likely reduced size on minimum interest of foreign investors.
"This is nothing to do with Bukopin's performance. It's more about the overall market sentiment," an investment banker said.
PT Bank Bukopin Tbk, a bank controlled by Indonesian government and Logistic Agency's Workers Cooperative, launched an IPO of 32% shares last month.
PT ABN Amro Securities, PT Bahana Sekuritas, and PT Indo Premier Securities are the underwriters of the IPO. ABN Amro was assigned to tap international investors, while Bahana and Indo Premier on local investors.
The bank would use the proceeds to boost loans to SMEs, expand its outlets, and improve human resources quality.
As of Dec 2005, Bukopin has total assets of Rp24.69 trillion (almost US$2.8 billion). The company booked net profit of Rp257 billion last year, increased from Rp210 billion in 2004.

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Undersubscribed on Indonesian offerings

There are two companies struggling to list their shares at Jakarta Stock Exchange (JSX). You may noticed that in the last few years, Indonesian companies were proudly announced oversubscription of their shares or bonds offering. For the first time in years I wrote the above title: Undersubscribed! to mark a new era of investor's decreasing appetite on Indonesian portfolios?

Early this week, I read a story about agriculture company PT CP Prima which cut the size of its IPO (re-listing to be exact) from Rp2 trillion to Rp400 billion. Today, Bisnis Indonesia reported cool respond from overseas investors on PT Bank Bukopin's IPO.
ABN Amro which got 55% allocation in Bukopin's IPO is reportedly want to pull out from the underwriting on poor investor's respond. That would leave local underwriters, Bahana and Indo Premier, with huge responsibility to get local investors' money especially without significant cut in IPO size.
An investment banker said ABN Amro even had offered Rp325 per share, well below the initial target of Rp350 to Rp520 per share. "Still, the demand is not enough," he said.
The closing of bookbuilding was initially scheduled June 16, but no information available on why Bukopin extend the process. Bukopin has few days ahead (till June 23) before the bookbuilding closed and let's see whether the bank would cut the size of its IPO or not.
Another important test will be the closing of the deal of the year (Borneo Lumbung's US$3.2 billion acquisition of two coal mining companies PT Kaltim Prima Coal and PT Arutmin Indonesia) scheduled June 30 with CSFB as the lead arranger of US$2.3 billion syndicated loan.
The raising interest rate in US to curb inflation is to blame, they said. But we may have to blame ourself, why our economy is not sexy enough to attract and bring in more money?

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Bukopin offers 32% shares to public

PT Bank Bukopin Tbk, a bank controlled by Indonesian government and Logistic Agency's Workers Cooperative, launch an IPO of 32% shares today.

PT ABN Amro Securities, PT Bahana Sekuritas, and PT Indo Premier Securities are the underwriters of the IPO.
The bank would use the proceeds to boost loans to SMEs, expand its outlets, and improve human resources quality.
As of Dec 2005, Bukopin has total assets of Rp24.69 trillion (almost US$2.8 billion). The company booked net profit of Rp257 billion last year, increased from Rp210 billion in 2004.

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Foreign banks recorded better 2005 performance

In contrast to the banks owned by Indonesian or majority controlled by foreign investors, the branches of foreign banks such as HSBC, Standard Chartered, and Citibank reported impressive net profit and asset growth last year. But ABN Amro and JP Morgan recorded heavy drop in net profit due to slashed margin despite impressive asset growth.

Citibank: Assets grew 31.6% to Rp32.3 trillion (US$3.29 billion), while net profit increased 19% to Rp1.099 trillion (US$111.8 million).

HSBC: Assets grew 49% from Rp16.38 trillion to Rp24.45 trillion (US$2.49 billion). The bank reported net profit of Rp446 billion (US$45 million) last year, up 13.8% from 2004.

Standard Chartered: Assets grew 35% to Rp19.72 trillion (US$2 billion), while net profit jumped 77% to Rp638 billion (US$65 million).

ABN Amro: Assets increased 24% to Rp18.84 trillion (US$1.9 billion), while net profit dropped significantly by 60% to Rp193 billion (US$19.6 million).

JP Morgan: Assets jumped 115% to Rp4.2 trillion (US$428 million), while net profit dropped to Rp36 billion (against Rp177 billion in 2004).

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