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Danantara gets US$1 billion loan at double cost of ‘patriot bonds’
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The Business Times
PHOTO: REUTERS[JAKARTA] Indonesian sovereign wealth fund Danantara has secured a loan equivalent to US$1 billion, people familiar with the matter said, paying more than double for the money than it did with its so-called patriot bonds.
That means Danantara is paying more than twice the 2 per cent coupon on its five- and seven-year patriot bonds that it previously issued to Indonesia’s richest families.
Danantara had approached banks last year for as much as US$10 billion – a deal that would have been South-east Asia’s largest loan.
It wound up deciding to raise only the US$1 billion, and kept the loan to that size despite the fact that about 29 banks joined.
The fund raised 50 trillion rupiah (S$3.8 billion) from those securities late last year, at yields it had acknowledged were below market levels.