Indonesia to restrict funding access for B rated corps

By Virginia Furness
06 Nov 2014

Indonesian corporates rated below BB will not be able to issue foreign debt in the international capital markets after 2016, if a recent proposal by Bank Indonesia is implemented in full. The bank is taking several measures to reduce Indonesian corporate exposure to dollars as quantitative easing comes to an end, but critics say the move will hurt the high yield market, writes Virginia Furness.

On October 30, Bank Indonesia (BI) proposed regulations that would force non-financial corporates to help stem currency risk, liquidity risk and overleverage risk. The bank is proposing the introduction of a minimum hedging ratio in order to mitigate currency risk, a minimum forex liquidity ratio to mitigate ...

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