Indonesia Introduces Benchmark INDOBEX Bond Indices
Indonesia’s Financial Services Authority (OJK) in cooperation with the Indonesian Bond Pricing Agency (IBPA) and the Indonesia Stock Exchange (IDX) has launched a bond index on Friday (21/11) involving government and corporate bonds that should function as a reference for the pricing and performance. This new index is called the INDOBEX and is divided into three types of indices: INDOBEX Composite, INDOBEX Government and INDOBEX Corporate. Each index has a total return, clean price, gross price, effective yield and gross yield index.
The INDOBEX Composite index includes 54 government bonds and 256 corporate bonds. Combined, these indices should increase liquidity and deepening of Indonesia’s bond market and provide a performance reference for investors. Indonesian Finance Minister Bambang Brodjonegoro, who was present at the launch, added that these indices would also increase market credibility.
Such a reference for performance and returns aims to encourage more investments in Indonesia’s bond market. Ignatius Girendroheru, President Director of the IBPA, stated that about IDR 10 trillion (USD $833 million) worth of daily transactions in government bonds and IDR 500 billion (USD $42 million) in corporate bonds are conducted.