• Latest
  • Trending
  • All
  • News
  • Business
  • Politics
  • Science
  • World
  • Lifestyle
  • Tech

Indonesian High Yield Bond Market Structure and Opportunities

December 4, 2019

10 Ways Baby Boomers Can Be Happier in 2018

December 4, 2019

Accounting Development in Third World Countries

December 4, 2019

The Top 10 Risks of Debt Recycling

December 4, 2019
Jan Tinbergen

Jan Tinbergen

December 4, 2019

When Should I Pay Dutch Payroll?

December 4, 2019

Your Legal Rights in a Living-Together Relationship – The Rights of Unmarried Cohabitants

December 4, 2019

The Sociologic Of Political Silence: Explaining A Discourse In Jamaica’s Society

December 4, 2019

Dumbing Down Our Children – This Is Education "Equity?"

December 4, 2019

How Does the 2018 Federal Budget Affect You and Your Family?

December 4, 2019

Profit Maximization Approach – The Financial Management Objectives

December 4, 2019

Capitalism, Socialism, and the Affordable Housing Market

December 3, 2019

The Welfare State in Europe

December 3, 2019
  • About
  • Advertise
  • Privacy & Policy
  • Contact
Tuesday, December 10, 2019
-18 °c
Chillicious
  • Home
  • News
    • All
    • Business
    • Politics
    • Science
    • World
    Bitcoin sinks to lowest level since May

    Bitcoin sinks to lowest level since May, falling $3,000 in a month as China accelerates crackdown

    General Motors strike looms over U.S. October job growth

    General Motors strike looms over U.S. October job growth

    Iraqi regime responds to mass protests with brutal crackdown

    Iraqi regime responds to mass protests with brutal crackdown

    New York City transit workers and the fight for social equality

    Australian state Labor government spearheads anti-protest laws

    Detroit Democrat John Conyers, long-standing fixture in Congress, dies at 90

    Detroit Democrat John Conyers, long-standing fixture in Congress, dies at 90

    GM execs gloat over new UAW contract in call with Wall Street investors

    GM execs gloat over new UAW contract in call with Wall Street investors

    Chicago Teachers Union preparing the betrayal of teachers’ strike

    Chicago Teachers Union preparing the betrayal of teachers’ strike

    retail sales unexpectedly decline

    US retail sales unexpectedly decline in a sign that consumer economy could be cracking

    cyber strike

    United States carried out secret cyber strike on Iran in wake of Saudi oil attack

    Trending Tags

    • Donald Trump
    • Future of News
    • Climate Change
    • Market Stories
    • Election Results
    • Flat Earth
  • Tech
    • All
    • Apps
    • Gear
    • Mobile
    • Startup

    Rap group call out publication for using their image in place of ‘gang’

    Meet the woman who’s making consumer boycotts great again

    New campaign wants you to raise funds for abuse victims by ditching the razor

    Twitter tweaks video again, adding view counts for some users

    A beginner’s guide to the legendary Tim Tam biscuit, now available in America

    India is bringing free Wi-Fi to more than 1,000 villages this year

    Betterment moves beyond robo-advising with human financial planners

    People are handing out badges at Tube stations to tackle loneliness

    Trump’s H-1B Visa Bill spooks India’s IT companies

    Oil spill off India’s southern coast leaves fisherman stranded, marine life impacted

    Trending Tags

    • Flat Earth
    • Sillicon Valley
    • Mr. Robot
    • MotoGP 2017
    • Golden Globes
    • Future of News
  • Entertainment
    • All
    • Gaming
    • Movie
    • Music
    • Sports

    Meet the woman who’s making consumer boycotts great again

    New campaign wants you to raise funds for abuse victims by ditching the razor

    Twitter tweaks video again, adding view counts for some users

    A beginner’s guide to the legendary Tim Tam biscuit, now available in America

    People are handing out badges at Tube stations to tackle loneliness

    Trump’s H-1B Visa Bill spooks India’s IT companies

    Magical fish basically has the power to conjure its own Patronus

    This Filipino guy channels his inner Miss Universe by strutting in six-inch heels and speedos

    Oil spill off India’s southern coast leaves fisherman stranded, marine life impacted

    You can now play Bill Gates’ first PC game and run over donkeys on your iPhone, Apple Watch

  • Lifestyle
    • All
    • Fashion
    • Food
    • Health
    • Travel

    Rap group call out publication for using their image in place of ‘gang’

    Meet the woman who’s making consumer boycotts great again

    New campaign wants you to raise funds for abuse victims by ditching the razor

    Twitter tweaks video again, adding view counts for some users

    India is bringing free Wi-Fi to more than 1,000 villages this year

    Betterment moves beyond robo-advising with human financial planners

    People are handing out badges at Tube stations to tackle loneliness

    Trump’s H-1B Visa Bill spooks India’s IT companies

    Magical fish basically has the power to conjure its own Patronus

    This Filipino guy channels his inner Miss Universe by strutting in six-inch heels and speedos

    Trending Tags

    • Golden Globes
    • Mr. Robot
    • MotoGP 2017
    • Climate Change
    • Flat Earth
No Result
View All Result
Chillicious
No Result
View All Result
Home Finance Taxes

Indonesian High Yield Bond Market Structure and Opportunities

in Taxes
0
492
SHARES
1.4k
VIEWS
Share on FacebookShare on Twitter

Global investor demand for Indonesian corporate paper increased substantially in 2012 and 2013 after the rating upgrade of Indonesia to investment grade early last year and investors looking for exposure in the country’s strong growth story (Indonesia’s GDP growth averaged above 6.0% over the last five years). Majority of the global bonds issued are USD-denominated and are non-investment grade due to the sovereign rating cap (Baa3/BB+/BBB-).

High yield bonds in Indonesia are typically issued through an SPV located in tax efficient jurisdictions like Singapore, Netherlands, or Cayman Islands. The bonds generally benefit from parent guarantee as well as guarantee from major operating subsidiaries, but in some instances certain key operating subsidiaries are excluded from guarantee. Investors should, therefore, carefully analyse the structure of the bond to ensure a tightly structured cash trap mechanism, which minimises chances of cash leakage. Also, given the fact that majority of the bonds issued are unsecured in nature, structural subordination and recourse to operating assets might be a concern if the bonds are loosely structured.

RelatedPosts

10 Ways Baby Boomers Can Be Happier in 2018

Accounting Development in Third World Countries

The Top 10 Risks of Debt Recycling

Jan Tinbergen

Covenants in the high yield bonds issued by Indonesian corporates are largely financial in nature, which restricts/ regulates the issuer’s financial activities within pre-determined limits. Generally, covenants fall into one of the following three categories:

· Affirmative Covenants: These covenants outline company requirements while the bonds are outstanding, and would include requirements such as maintenance and submission of quarterly accounts, payment of taxes, maintenance of insurance, payment of bank interest and fees, etc.

· Negative Covenants: These covenants limit company activities. For example limits on mergers/ acquisitions, asset sales, dividend payment, negative pledge, etc.

· Financial Covenants: These covenants require that the issuer maintain a minimum financial condition, usually in the form of ratios. Standard financial covenants include restrictions on debt incurrence (the most commonly used being Fixed Charged Coverage ratio), restricted payments, restriction on asset sales, Interest Reserve Accounts, etc.

High yield bond covenants in Indonesia are broadly in line with those in China, Hong Kong, Singapore, and India. They do act as an early indicator of any potential default. For example, certain high yield bond indentures require that the issuer to maintain an Interest Reserve Account with a Trustee Bank, where at least one interest payment amount on the bonds is deposited at all times. If the issuer of the bond fails to timely top-up this account, it acts as an early indication of liquidity issues within the issuer company.

As a result of global tightening bias and flight safer assets, the USD-denominated bonds issued by Indonesian corporates have consistently declined in price over the last two months. The long dated papers, in particular, have declined considerably reflecting increased inflation expectations amidst ongoing fuel reforms in the country. This trend is in line with other emerging market bond performance, as global investors moved funds out of emerging markets to safer assets. While it is difficult to say if the bond prices have bottomed at current levels, the running prices adequately price-in the expected Fed tapering and tightening interest rate environment in Indonesia. Therefore, the current low prices offer select good investment opportunities for global fixed income investors and wealth management firms.

Tags: BondHighIndonesianMarketOpportunitiesStructureYield
Share197Tweet123Share49
Previous Post

Your Legal Rights in a Living-Together Relationship - The Rights of Unmarried Cohabitants

Next Post

When Should I Pay Dutch Payroll?

Related Posts

10 Ways Baby Boomers Can Be Happier in 2018

December 4, 2019
0

How can you live your best life and be happier in 2018? Here are 10 surefire ways to help you...

Accounting Development in Third World Countries

December 4, 2019
0

Most third world countries have nearly nonexistent accounting standards and lack the education to inaugurate a movement towards achieving their...

The Top 10 Risks of Debt Recycling

December 4, 2019
0

What is debt recycling?Quite often the first time you hear about debt recycling will be from a financial planner or...

Jan Tinbergen

Jan Tinbergen

December 4, 2019
0

Jan Tinbergen, (born April twelve, 1903, The Hague, Netherlands. - died June nine, 1994, Netherlands), Dutch economist observed for the...

Next Post

When Should I Pay Dutch Payroll?

Jan Tinbergen

Jan Tinbergen

  • Trending
  • Comments
  • Latest

Business Ethics for the Mindful Dance Professional

October 19, 2019

A beginner’s guide to the legendary Tim Tam biscuit, now available in America

August 10, 2019

3 Things You Don’t Know About Your Credit Score

October 12, 2019

10 Ways Baby Boomers Can Be Happier in 2018

0

Barack Obama’s Now Mainly Focusing on Wearing This Casual Backwards Hat

0

Watch Justin Timberlake’s ‘Cry Me a River’ Come to Life in Mesmerizing Dance

0

10 Ways Baby Boomers Can Be Happier in 2018

December 4, 2019

Accounting Development in Third World Countries

December 4, 2019

The Top 10 Risks of Debt Recycling

December 4, 2019
Chillicious

Copyright © 2007 Chillicious.

Navigate Site

  • About
  • Advertise
  • Privacy & Policy
  • Contact

Follow Us

No Result
View All Result
  • Home
  • News
    • Politics
    • Business
    • World
    • Science
  • Entertainment
    • Gaming
    • Music
    • Movie
    • Sports
  • Tech
    • Apps
    • Gear
    • Mobile
    • Startup
  • Lifestyle
    • Food
    • Fashion
    • Health
    • Travel

Copyright © 2007 Chillicious.

Login to your account below

Forgotten Password?

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
neque. ut luctus Praesent ante. Curabitur vel, Aenean elit. mi, diam massa
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.