Earlier this month S&P assigned the investment grade status to Indonesia's sovereign rating (BBB-/stable outlook). This decision led to a stronger rupiah rate, while the rupiah and US dollar-denominated ten-year government bond yields fell from 6.92 percent to 3.73 percent.

Read also: Indonesia Gets Investment Grade Credit Rating Status from S&P

Panji Irawan, Director Treasury and International at Bank Negara Indonesia (BNI) said the ratings upgrade has already impacted positively. But despite the better environment for the financial sector of Indonesia, BNI decided not to issue more bonds than the planned sale of a total of IDR 10 trillion worth of bonds up to 2018.

Similarly, Bank Central Asia (BCA) said the rating upgrade from S&P implies it will cost Indonesian banks less to sell bonds due to lower interest rates. However, BCA is currently not interested to sell bonds because it remains the more costly option for Indonesia’s largest lender by market value. BCA's funding primarily comes from third-party funds (savings, giro and deposit accounts). Based on a report released in March 2017, BCA's loan-to-funding ratio was still safe at 75.1 percent.

Meanwhile, Bank Tabungan Negara (BTN), the market leader in Indonesia's mortgage loans sector, will also not adjust its bond plans because of the sudden S&P rating upgrade. BTN had already planned to sell IDR 5 trillion worth of bonds in 2017 to finance credit expansion. The timing or amount of bonds will not be adjusted, BTN Finance Director Iman Nugroho Soeko said.