Investor Meeting Presentation December 2012 Directorate General of - PowerPoint PPT Presentation

Investor Meeting Presentation December 2012 Directorate General of Debt Management Ministry of Finance of The Republic of Indonesia www.dmo.or.id

Tab able le of of Con ontent tent Government Debt Position Prudent Fiscal Management Preserved Macroeconomic Stability to Support Further Growth

Government Debt Position

Gov’t. Debt Outstanding 2007 -2012 [ triliun rupiah/ in trillion IDR ] 2,000 1,800 633 1,600 621 1,400 617 611 730 1,200 586 1,000 800 1,359 600 1,188 1,064 979 906 400 803 200 - 2007 2008 2009 2010 2011 2012+ Pinjaman/ Loans SBN/ Securities [ dalam triliun Rupiah dan %/ in trillion IDR and % ] 2012 + 2007 2008 2009 2010 2011 Tahun/ Year Pinjaman/ Loans 586 42% 730 45% 611 38% 617 37% 621 37% 633 32% SBN/ Securities 803 58% 906 55% 979 62% 1,064 63% 1,188 63% 1,359 68% Total Utang Pemerintah Pusat/ 1,389 100% 1,637 100% 1,591 100% 1,682 100% 1,809 100% 1,992 100% Central Govt. Debt Total Notes: + Provisional as of October 31, 2012 4

Debt Maturity Profile [triliun Rupiah/ in trillion IDR] 140 As of October 31, 2012 120 55 57 100 57 31 42 44 80 51 43 36 45 60 2 8 12 26 40 77 1 76 74 72 18 70 66 1 11 60 8 14 57 8 22 15 52 50 47 44 43 7 2 20 35 32 28 28 26 27 27 23 20 1 18 15 5 13 1 9 4 - 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040-2055 Pinjaman/ Loans SBN/ Securities 100,00 As of December 5, 2012 80,00 60,00 40,00 20,00 - 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2030 2031 2032 2033 2035 2036 2037 2038 2041 2042 TOTAL 15,4 77,0 71,5 77,1 51,6 49,5 68,7 56,7 69,7 59,8 92,1 31,5 18,0 28,0 19,6 44,2 30,1 25,6 27,1 42,8 13,8 15,3 4,11 27,5 34,9 13,5 33,6 SUKUK USD - - 6,24 - - - 9,61 - - - 9,61 - - - - - - - - - - - - - - - - SUKUK IDR - 8,78 7,34 18,9 - 1,17 7,91 - 0,25 - 1,21 - - 1,55 - 2,85 - 2,18 - - - - 4,11 6,74 - - - SUN JPY - - - - - - - 4,10 7,03 - 7,03 - - - - - - - - - - - - - - - - SUN USD - - 22,0 9,61 8,64 9,61 18,2 19,2 19,2 24,0 19,2 - - - - - - - - - - 15,3 - 14,4 19,2 - 21,6 SUN IDR 15,4 68,2 35,8 48,5 43,0 38,7 33,0 33,4 43,2 35,8 55,1 31,5 18,0 26,4 19,6 41,4 30,1 23,5 27,1 42,8 13,8 - - 6,40 15,6 13,5 12,0 5

Debt Risk Indicators, 2007-2011 Interest Rate Risk Exchange Rate Risk 52.1 30.2 28.2 28.2 47.4 46.9 46.2 26.7 45.1 26.1 25.9 44.8 22.9 22.3 21.2 20.3 18.8 16.1 17.2 16.5 13.4 12.1 10.9 11.0 2007 2008 2009 2010 2011 Q3-2012 2007 2008 2009 2010 2011 Q3-2012 Variable rate ratio [%] Refixing rate [%] FX Debt to GDP ratio (%) FX Debt to total debt ratio (%) Average Time To Maturity (ATM)-Years Debt Maturing in 1, 3 and 5 Years 10.4 34.6 34.2 33.7 33.2 31.1 30.6 10.0 9.8 22.7 22.3 9.7 20.8 20.3 19.4 18.6 9.5 9.3 8.3 8.2 7.6 7.1 6.8 6.4 2007 2008 2009 2010 2011 Q3-2012 2007 2008 2009 2010 2011 Q3-2012 Maturity debt portion < 1 year (%) Maturity debt portion < 3 year (%) Average Time to Maturity (in percentage) Maturity debt portion < 5 year (%) 6

Financing Trend, 2006 – 2012 Budget Deficit Financing (trillion IDR) 200 2,5 2,2 2,0 150 1,6 1,5 100 1,3 1,3 1,0 0,9 50 0,7 0,5 0 0,1 - -50 (0,5) 2006+ 2007+ 2008+ 2009+ 2010+ 2011++ 2012+++ Govt Securities - net 36,0 57,2 85,9 99,5 91,1 119,9 159,6 Domestic Loan - - - - - 0,3 1,0 External Loan - net (26,6) (26,6) (18,4) (15,5) (4,57) (19,2) (4,4) Others/Non-Debt - net 20,0 9,1 16,5 28,6 5,0 28,3 33,9 Budget Defisit, % to GDP 0,9 1,3 0,1 1,6 0,7 1,3 2,2 Notes: + Based on Audited Budget Report 7 ++ Based on Realized Budget 2011 (preliminary figure) +++ Based on Revised Budget 2012

Debt to GDP Ratio and Debt Service Ratio 2005 – 2012 Interest Expenses to Revenue and Debt to GDP Ratio (% of GDP) Expenditure Ratio (%) 40% 12% 35,2% 33,1% 10% 28,3% 30% 26,1% 24,4% 8% 23,2% 11,28% 11,05% 6% 20% 9,01% 8,88% 7,70% 4% 10,53% 10,00% 10% 8,97% 8,48% 7,20% 2% 0% 0% 2007 2008 2009 2010 2011 2007 2008 2009 2010 2011 2012* Interest to Revenue Interest to Expenditure Interest Expenses to Tax Revenue & Central Debt Service to GDP Ratio (%) Government Expenditure Ratio (%) 6% 18% 5,0% 16% 5% 14% 4,0% 3,8% 12% 4% 3,4% 3,3% 3,1% 10% 15,8% 14,9% 3% 8% 12,8% 12,7% 12,2% 10,6% 6% 2% 4% 17,0% 14,2% 15,1% 12,2% 10,7% 11,4% 2% 1% 0% 2007 2008 2009 2010 2011 2012* 0% to Tax Revenue to Central Gov't Expenditure 2007 2008 2009 2010 2011 2012* Notes: * Based on Revised Budget 2012 8

Gov’t Debt Securities Issuance Plan 2012 Gov’t Debt Operation – Policy Combination 2012 - Revised 2012 - Budget Budget  Issuing in domestic market will be prioritized IDR $ USD IDR $ USD  Issuing in variety of tenor (trillion) (billion) (trillion) (billion)  Issuing in global market (Global Bond and Deficit (124,0) (12,89) (190,1) (19,75) Samurai Bond) Amortization (167,6) (17,42) (158,8) (16,50)  Maximum foreign issuance 18% from total gov’t debt securities issuance External Loan (47) (5) (50) (5)  Buyback, debt switching, direct transaction Govt Securities (incl Buyback) (120) (12) (109) (11)  Initiatives strategic :USD issuance domestically & Domestic Loan (0,14) (0,01) (0,14) (0,01) liability management (USD bonds) Non Debt Financing Expenditures (18,77) (1,95) (26,62) (2,77) Two Steps Loan (8,9) (0,93) (8,4) (0,88) Benchmark Series for Indicative Tenor in Financing Needs (319,3) (33,2) (384,0) (39,9) Domestic Market 2012 Financing Sources 319,3 33,2 384,0 39,9 FR 60 – 5 Y 1 y - 30 % *   Non Debt (Gross) 9,2 0,96 60,6 6,29 FR 61 – 10 Y 3 y - 7 % * ^   Debt (Gross) 310,1 32,22 323,4 33,60 FR 59 – 15 Y 5 y - 16 % *   FR 58 – 20 Y 10 y - 18 % *   Govt Securities 254,8 26,5 268,5 27,9 15 y - 15 % *  Program Loan 15,3 1,6 15,6 1,6 > 20 y - 14 % *  Project Loan (Bruto) 39,0 4,1 38,1 4,0 * as percentage of total gross securities issuance in the domestic market Domestic Loan 1,0 0,1 1,1 0,1 ^ Retail bond 9 Exchange Rate Assumption (IDR/USD 1) a.o December 7, 2012 : IDR 9.625

2012 Funding Strategy Progress [in IDR Billion] 2012 Revised Budget % Realization Realization (ao Dec 7, 2012) Government Securities Maturity 2012 107.822.708 92.337.565 85,64% Government Securities Net 159.587.623 175.072.766 109,70% Buyback 1.137.527 1.137.527 100,00% Issuance Need 2012 268.547.858 268.547.858 100,00% Government Debt Securities (GDS) 211.459.053 Domestic GDS 165.441.745 122.245.000 - Coupon GDS - Conventional T-Bills 30.520.000 12.676.745 - Retail Bonds 46.017.308 International Bonds - USD Global Bonds 39.005.000 - Samurai Bonds 7.012.308 Government Islamic Debt Securities 57.088.805 Domestic Government Islamic Debt Securities 47.449.805 - IFR/PBS (Islamic Fixed Rated Bond/Proje 17.114.000 - Islamic T-Bills 1.380.000 - Retail Sukuk 13.613.805 - SDHI 15.342.000 International Sukuk 9.639.000 10

Debt Issuance Program 2012 Calendar of Issuance Realization Tenor (sector) 1) Month Date Type (IDR) Issuance in 1 st Quarter 2) 60.387.000.000.000 Issuance in 2 nd Quarter 2) 41.370.000.000.000 Issuance in 3 rd Quarter 2) 42.393.000.000.000 October October 2, 2012 IFR/PBS 5, 25 year SPN-S 6 month October 9, 2012 ON 15, 20 year SPN 3 month, 1 year October 16, 2012 IFR/PBS 5, 25 year SPN-S 6 month October 23, 2012 ON 5, 10 year SPN 1 year October 30, 2012 IFR/PBS 5, 25 year SPN-S 6 month November November 12, 2012 ON 15, 20 year SPN 3 month, 1 year November 27, 2012 ON 5, 10 year SPN 1 year December December 4, 2012 ON 10, 15 year SPN 3 month, 1 year 29.000.000.000.000 Total Issuance in 4 th Quarter 2) 1) Tenor (sector) means that the tenor to be issued will be around the tenor stated in column "Tenor (sector)". 2) The total of issuance is excluding Sukuk Retail, ORI, and International Bonds. 11 11

Domestic Market is Arising The amount of incoming bids for long 500 15 tenor bonds from local institutional 13,97 buyers (pension funds, insurance 430,59 11,92 11,86 393,41 companies and mutual funds) has 400 12 improved significantly in recent 10,42 10,14 10,04 10,01 auctions 315,91 300 9 Incoming Bid - Long Tenor (≥ 10 years) 7,57 59% 52% 51% 51% 51% 198,23 5,96 49% 48% 189,46 200 6 45% 45% 44% 5,30 41% 38% 37% 35% 35% 152,77 33% 32% 136,18 30% 29% 138,85 26% 24% 24% 24% 24% 24% 24% 23% 101,90 20% 95,57 19% 17% 100 3 16% 14% 14% 79,20 70,78 66,06 53,98 48,73 39,30 24,60 23,57 22,54 11,71 - 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 ao. Dec 3, 2012 Total Incoming Bid Total Bid Accepted Yeild at Tenor 10 year Foreign Local Bank & Central Bank Others Increasing demand in domestic primary market align with downward trend in Others : Domestic pension funds, insurance companies and borrowing cost mutual funds 12 12