Indonesia Loan House
DBS Bank was integral to the double-digit growth in Indonesia’s loan markets this year, leading deals offshore and onshore, as well as selling the nation’s growth story to the wider market.
DBS brought many first-time borrowers to the international arena and played key roles in several financings to allow Indonesian borrowers to retain access to funding at a challenging time for other asset classes.
Market volatility and a drop in the rupiah’s value mid-way through the review period derailed numerous bond issues and halted many share sales. Borrowers, too, were forced to review plans and many shifted from US dollars to rupiah.
Singapore-based DBS continued to originate and syndicate loans in both currencies, especially for firms in retail-related industries that were benefiting from Indonesia’s rising consumer class.
A Rp1trn (US$87m) five-year loan for beverage company Sinar Sosro, the second sole mandate for DBS, came at the height of the summer selloff. Despite a spike in interbank lending rates, DBS lured five other foreign banks to the facility and closed the deal within three weeks of launch.
The bank was also sole manager of Royal Industries Indonesia‘s US$300m loan, a trade financing that converts into an accounts receivable financing. The debut deal for the consumer products maker attracted six other local and foreign banks.
“It was a transformational year for Indonesia,” said Boey Yin Chong, managing director for syndicated finance. “I haven’t seen such volumes and reception, both in terms of quality and quantity from Indonesia since 1997. We led from the front, several of the most successful transactions from Indonesia.”
Other high-profile deals included a US$965m five-year loan for state-owned oil-and-gas company Pertamina, which looked at a US$602m borrowing before adding a US$363m tranche. DBS was one of the eight bookrunners on the deal, with 21 other banks joining before it closed in January.
That response set the tone for the rest of the year. Profesional Telekomunikasi Indonesia signed a US$627m-equivalent six-month bridge in December 2012 with DBS and two others. The US$575m five-year takeout that followed attracted another 30 banks in syndication.
A debut US$504m dual-currency loan for poultry feed producer Charoen Pokphand Indonesia was another feather in the cap for DBS, one of two original underwriters. The deal was increased from US$400m on participation from 18 other lenders.
DBS also was among the bookrunners on the hugely successful US$750m three-year loan for CT Corp/Trans Retail, which tied the record for the widest distribution on any syndicated loan in Asia, excluding Japan.
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