ICBC contributes IDR 317 billion to IDR 8.07 trillion syndicated loan for Bakauheni–Terbanggi Besar Toll Road Construction Project (Linked to Project ID#68792)

On December 27, 2017, PT Hutama Karya (Persero) — an Indonesian state-owned construction company — signed an IDR 8.067 trillion syndicated loan agreement for the Bakauheni–Terbanggi Besar Toll Road Construction Project. The deal also involved a credit default swap facility from Sarana Multi Infrastruktur (SMI) worth IDR 7.52 trillion. The members of the loan syndicate included Bank Mandiri, BNI, BCA, Bank CIMB Niaga, Bank Maybank Indonesia, ICBC Indonesia, and Bank Permata. ICBC Indonesia contributed IDR 317 billion to the loan syndicate. The borrowing terms of the loan were as follows: a grace period of 7 years, a maturity period of 15 years, and an interest rate of SUN tenor 15 years + a 1.5% margin (Note: SUN refers to Surat Utang Negara or Government bonds.) The Minister of Finance of the Republic of Indonesia issued a sovereign guarantee in support of this loan (via Government Guarantee Letter No. S-416/MK.08/2018 dated June 6, 2018). The total cost of the project was IDR 16.7 trillion. The remaining funds came from equity, which consisted of a state capital injection (PMN) amounting to IDR 2.2 trillion and a corporate bond sale of IDR 6.5 trillion. The purpose of the project was to construct a 140.98 km (87.60 mi) toll road — with two lanes in each direction and nine interchanges — that runs from Terbanggi Besar to Bakauheni Port. The Bakauheni–Terbanggi Besar Toll Road, which is part of the larger Trans-Sumatra Toll Road, is divided into four sections: Section 1: Bakauheni - Sidomulyo (39 km); Section 2: Sidomulyo - Kotabaru (40 km); Section 3: Kotabaru- Metro (30 km); and Section 4: Metro- Terbanggi Besar (31.9 km). Construction of the toll road officially commenced on April 30, 2015. Section 1 and part of Section 2 (5 kilometers from Lematang Interchange to Kota Baru Interchange) was completed and opened to traffic on January 21, 2018. The rest of Section 2, Section 3 and Section 4 were completed officially opened to traffic on March 8, 2019.

Additional details

1. This project is also known as the Bakauhenni-Terbangii Besar Toll Road Construction Project. 2. Based on the Ministry of Finance FR SUN Series for 2017, FR0074 has a 15-year maturity and a coupon of 7.50%, which AidData used to calculate the interest rate of 9% (7.50% + 1.5%). 3. This project is linked to Project ID#68792, the MoU signed by ICBC in 2015 to provide $20 billion for infrastructure projects.

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