Investor Presentaiton
Bank Indonesia Policy Mix: April 2020
Mitigating the risk of COVID-19 transmission
B BANK INDONESIA
BANK SENTRAL REPUBLIK INDONESIA
Bank Indonesia Issued Implementing Provisions for Auction of Government Debt Securities (SUN) and/or
Government Islamic Securities (SBSN) in the Primary Market
BHINNISM
Bank Indonesia issued Board Member of Governors Regulation No. 22/5/PADG/2020 on Auction of Government Debt Securities and/or
Government Islamic Securities in the Primary Market to Maintain State Financial Management Sustainability as Implementation of
Government Regulation in Lieu of Law Number 1 of 2020 on State Financial Policy and Stability of Financial Systems for the Management
of Corona Virus Disease 2019 (Covid-19) and/or Encounter the Threat to National Economy and/or Stability of Financial Systems. The
regulation starts to take effect on 20 April 2020.
The regulation serves as a follow-up to Government Regulation in Lieu of Law Number 1 of 2020, granting authority to Bank Indonesia
among others to purchase Government Debt Securities (SUN) and/or Government Islamic Securities (SBSN) in the primary market. It is
necessary as a funding source for the government to recover the national economy including maintaining state financial management
sustainability including SUN and/or SBSN issued in response to COVID-19 pandemic. Purchase of SUN and/or SBSN in the primary market
is based on principle that Bank Indonesia is a last resort if the market capacity is unable to purchase them and/or result in high yield
increase. Further, this regulation specifies the following:
1) Bank Indonesia holds auction of SUN and/or SBSN and auction of additional SUN and/or SBSN for long-term SUN and/or SBSN in the
primary market as a follow-up to the implementation of Government Regulation in Lieu of Law Number 1 of 2020.
2) Provisions for offer quote and participants of auction of SUN and/or SBSN and auction of additional SUN and/or SBSN refer to the
applicable Finance Minister Regulation on auction of SUN and/or SBSN in the domestic primary market.
3) Bank Indonesia may quote an offer to purchase long-term SUN and/or SBSN in auction of SUN and/or SBSN and auction of additional
SUN and/or SBSN in the following manners: a. directly without using the main dealer and/or SBSN main dealer; b. non-competitive bid.
4) Implementation of auction of SUN and/or SBSN and auction of additional SUN and/or SBSN refer to the applicable Bank Indonesia
provisions for auction of Government securities in the primary market provided that they are not in contravention of this regulation.
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