S&P rates Indonesia bond BB+

Standard & Poor’s said it assigned a BB+ long-term foreign-currency rating to a proposed global sukuk trust certificate issuance under the $10 billion sukuk program of the Republic of Indonesia through Perusahaan Penerbit SBSN Indonesia III (PPSI-III).

The issuer is a fully owned special purpose vehicle of the Republic of Indonesia, established solely for issuing foreign-currency-denominated Sharia-compliant securities of Indonesia in international markets, S&P said.

The ratings reflect the long-term foreign-currency rating on Indonesia because Indonesia will provide sufficient and timely contractual obligations for the repayment of the periodic distribution amounts and the principal amount, the agency said.

The ratings also consider that Indonesia’s obligations are irrevocable and unconditional and rank pari passu with Indonesia’s other general financial obligations, S&P said.

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