The Financial Services Authority (OJK) finally relaxed the issuance of debt securities in the multi-finance industry. The presence of this relaxation is expected to encourage optimization of performance, stability and growth of the financing industry during the Covid-19 pandemic. Initially, the provisions for the issuance of securities through public offerings or not through public offerings for financing companies were regulated in Article 69 to Article 78 POJK 35 / POJK.05 / 2018 concerning Business Conduct of Financing Companies.
OJK then includes the relaxation in POJK 58 / POJK.05 / 2020 concerning Amendments to POJK Number 14 / POJK.05 / 2020 concerning Countercyclical Policies on the Impact of the Spread of Coronavirus Disease 2019 for Non-bank Financial Services Institutions. Head of the Department of Supervision of the Non-Bank Financial Industry (IKNB) 2B OJK Bambang W. Budiawan said this provision is contained in Article 20E POJK 58/2020 which regulates several things. First, a finance company that has equity of more than Rp 100 billion can issue debt securities or sukuk without going through a public offering. "Second, finance companies and Islamic finance companies can report the plan to issue securities or sukuk to the OJK no later than two months before issuance," Bambang explained, Monday (11/1). Third, the issuance of debt securities with a value of up to Rp 100 billion does not need to fulfill two conditions, namely a rating with a minimum investment-worthy yield from a rating agency that has OJK's license. Then the provision is that the rating process must be carried out periodically and at least once a year.
Until now, according to Bambang, no company has submitted a request for relaxation. Based on the results of monitoring since this provision was implemented on 16 December 2020 to date, there are two companies that have reported plans to issue debt securities without going through a public offering. "However, the two finance companies are companies that do not require the relaxation provided by POJK 58/2020," he said.
On the other hand, he estimates that the multi-faceted companies that will take advantage of the easing are companies with stand alone status or do not have affiliations with Brand Holder Sole Agents (ATPM) and banks. "The company is considered to be the most affected by the tightening of credit distribution by the banking industry so that relaxation in issuing securities is expected to support the company's capital," he explained. The industry has responded variously to the relaxation. Indomobil Finance Chief Executive Officer Gunawan Effendi assessed that this policy will help accelerate the process of issuing debt securities. However, Indomobil Finance has no plans to issue debt securities in the near future because the credit ceiling is still sufficient. "If there is a funding need and a coupon that investors hope is quite attractive, of course we will consider issuing bonds in 2021," he explained.
BCA Finance President Director Roni Haslim also stated that his party has not planned to relax the issuance of debt securities. This is because BCA Finance is still able to pay off its debts from the company's treasury. "We also still have an unused bank loan ceiling of around Rp 2 trillion. So, we don't need to relax," added Roni.