TheIKNPost.com – PT Bank Negara Indonesia (Persero) Tbk or BNI made a brilliant achievement in issuing global bonds worth US$500 million or equivalent to IDR 7.9 trillion.
The bonds, which are part of the Euro Medium Term Note (EMTN) issuance, experienced excess demand or oversubscription of up to 6.4 times during the initial pricing guidance (IPG).
BNI Finance Director Novita Widya Anggraini said that the high level of investor interest in BNI Global Bond reflects investor confidence in the company’s fundamentals and prospects.
“The fundamental transformation that we have carried out has attracted investors’ interest in buying BNI Global Bonds. “Oversubscription of 6.4 times shows the high level of investor confidence in the company,” said Novita in the “Money Talks Power Lunch” program on CNBC TV, Tuesday (2/4/2024).
This Global Bond issuance is part of BNI’s strategy to diversify funding sources and support the company’s strategic steps in increasing business growth, not only in rupiah but also foreign currency (forex).
He explained that BNI Global Bond is part of EMTN which was formed on May 6 2020 and was updated on March 22 2021 and March 26 2024.
This EMTN program allows BNI to issue debt securities in stages with a maximum principal amount of US$2 billion.
The company completed the roadshow on March 26 2024 and pricing on March 27 2024.
Bond interest is set at 5.28% per year, indicating the level of investor confidence in BNI.
Novita further explained, since 2020, BNI has carried out a transformation which has resulted in an increase in Return on Equity (ROE) from 2.6% in 2020 to 15.2% in 2023.
This shows a high leap in the company’s profitability.
“BNI’s fundamental transformation has increased ROE and reduced cost of funds. BNI’s capital adequacy level has also increased, as reflected in the core capital adequacy ratio or Tier-1 CAR, which rose from 16% during the pandemic to 20% currently. “This adds to investors’ confidence in BNI’s strong fundamentals,” explained Novita.
Novita added that currently BNI’s source of liquidity is not only from the issuance of securities, but mainly comes from collecting DPK.
The portion of wholesale funding, including the issuance of securities, in the last 3 years has only been 8% -9% of total liabilities.
The funds obtained from the issuance of these bonds will later be channeled for financing with attractive margin levels, thereby having a positive impact on the company’s profitability.
