Why Do State-Owned Banks Look for Loans?

By Editorial Team 18/05/2020
Summary

PT Bank Rakyat Indonesia Tbk (BBRI) recently secured US$ 1 billion or around Rp 15 trillion (exchange rate of Rp 15,000 per US dollar) worth of foreign loan commitment. BRI’s president director, Sunarso, said it was necessary to increase the bank’s liquidity to face the crisis caused by the Covid-19 pandemic. “We are trying to maintain the liquidity, so we have already secured the deals with foreign banks,” Sunarso explained in a video conference last weekend.

Besides BRI, two other state-owned banks also issued various instruments to increase liquidities. PT Bank Mandiri Tbk (BMRI), for example, released US$ 500 million or Rp 7.5 trillion worth of Euro Medium Term Notes (EMTN). Previously on May 5, 2020, Mandiri also issued EMTN valued at US$ 500 million with non-US dollar fixed interest rates. Bank Mandiri also issued Rp 1 trillion worth of bonds as part of the shelf offering (PUB) II. Meanwhile, BNI is aiming to collect Rp 29 trillion through global securities.

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