Directorate of Government Debt Securities Directorate General of Debt Management Ministry of Finance of The Republic of Indonesia

Government Securities Management January 2nd, 2015

OUTLINE

1. Government Securities Management and Financing

Strategy

2. Government Securities Performance

3. Crisis Management Protocol & Bond Stabilization

Framework

4. Debt Outstanding & Risk Profile

2

Government Securities

Management and Financing Strategy

Key Initiatives to Develop Domestic Gov. Securities

Market

Facilitating the development of derivative instrument and Government securities repo:

• Develop a deep and liquid repo market, coordinate with FSA

• Facilitating the development of Government Bond Futures

Focused on a few benchmark series with large outstanding

Introduction of an electronic trading platform (ETP)

Strengthening Investor Relations (IR)

Launch a new primary dealer system

Increase domestic participation from key investors

Continuously improving bond stabilization framework

4

Financing Trend, 2004 – 2015

(trillion IDR)

Notes: * Revised Budget 2014

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014* 2015

Govt Securities - net 6.9 22.6 36.0 57.2 85.9 99.5 91.1 119.9 159.7 224.6 265.0 277.0

Domestic Loan - - - - - 0.4 0.6 0.8 0.4 2.2 1.6

External Loan - net (28.1) (10.3) (26.6) (26.6) (18.4) (12.4) (4.6) (17.8) (23.5) (5.8) (13.4) (23.8)

Others/Non-Debt - net 42.0 (1.2) 20.0 9.1 16.6 25.5 4.6 28.3 38.1 18.1 (12.2) (9.0)

Budget Defisit, % to GDP 1.1 0.5 0.9 1.3 0.1 1.6 0.7 1.1 1.8 2.3 2.4 2.2

1.1

0.5

0.9

1.3

0.1

1.6

0.7

1.1

1.8

2.3 2.4

2.2

(0.5)

-

0.5

1.0

1.5

2.0

2.5

-50

0

50

100

150

200

250

300

5

Securities Financing Realization 2015

*Adjusted by changes in Cash Management & Debt Switch

*(Million IDR)

Budget 2015*Realization

(ao Jan 2, 2015)*

% Realization to

Budget 2015

Government Securities Net 277,049,800 - 0.00%

Government Securities Maturing in 2015 153,612,324 875,000 0.57%

-Buyback 3,000,000 - 0.00%

Issuance Need 2015* 430,662,124 3,000,000 0.70%

Government Debt Securities (GDS) 3,000,000

Domestic GDS 3,000,000

-Coupon GDS -

-Conventional T-Bills -

-Private Placement 3,000,000

-Retail Bonds -

International Bonds -

-USD GMTN -

-Euro GMTN -

-Samurai Bonds -

Government Islamic Debt Securities -

Domestic Government Islamic Debt Securities -

- IFR/PBS/T-Bills Sukuk (Islamic Fixed Rated Bond/Project Based Sukuk) -

- Retail Sukuk -

Global Sukuk -

6

General Strategy for Debt Financing 2015

1. Optimizes Governments securities (SBN) issuance from domestic sources to fulfill Budget need and uses

foreign debts as complimentary;

2. Determines debt instrument by taken into account of market need in regard to market development and

portfolio management;

3. Issues Retail Bond for instrument diversification and financial inclusion;

4. Optimizes foreign and domestic loan instrument to fulfill Budget need on capital expenditure;

5. Conducts active portfolio management of Government securities through, among others, debt buyback

and debt switch, in order to promote market liquidity and stability;

6. Strengthens the function of Investor Relations Unit, among others, through the proactive dissemination of

information, rapid and effective responses, and effective communication with investors and other stakeholders.

7

Government Budget 2015 (Baseline)

8

In billion IDR

A. Total Revenue 1,793,588.9 16.1%

B. Total Expenditure 2,039,483.6 18.3%

Interest Payment 151,968.3 1.4%

Domestic 137,941.8 1.2%

Foreign 14,026.5 0.1%

C. Primary Balance (93,926.4) -0.8%

D. Deficit (245,894.7) -2.2%

E. Financing 245,894.7 2.2%

I. Non Debt (8,961.3) -0.1%

II. Debt 254,856.0 2.3%

1. Government Securities (Net) 277,049.8 2.5%

2. Foreign Loan (Net) (23,815.0) - 0.2%

3. Domestic Loan (Net) 1,621.2 0.0%

Assumptions :

GDP (trillion IDR) (Y.o.Y) 11,146,943.0

Growth (%) 5.8

Inflation (%) y-o-y 4.4

3-month-SPN (%) 6.0

IDR/USD (average) 11,900

Budget % to GDP

2015

Description

8

Financing 2015

9

In billion IDR Financing sources come

from debt financing

(88.75% from Government

Securities, 10.10% from

Loan) and the rest 1.15%

from non debt financing;

(* Non Debt Financing

Expenditures:

• Gov’t Investment Fund;

• Contingent Liabilities.

(** Non Debt Sources:

• Inflows from On-Lending

Repayment;

• Inflows from Asset

Management.

A. Total Revenue 1,793,588.9 16.09

B. Total Expenditure 2,039,483.6 18.30

Interest Payment 151,968.3 1.36

C. Primary Balance (93,926.4) (0.84)

D. Deficit (245,894.7) (2.21)

E. Financing 245,894.7 2.21

I. Non Debt (287,039.1) (2.58)

II. Debt 532,933.8 4.78

1. Government Securities (Net) 277,049.8 2.49

i. Issuance 430,986.1 3.87

ii. Principal Refinancing and Buyback (153,936.3) (1.38)

2. Loan (Net) (22,193.9) (0.20)

i. Foreign Loan (Net) (23,815.1) (0.21)

Disbursement 47,037.1 0.42

- Program Loan 7,140.0 0.06

- Project Loan 39,897.1 0.36

On Lending (4,319.4) (0.04)

Foreign Loan Principal Payment (66,532.8) (0.60)

ii. Domestic Loan (Net) 1,621.2 0.01

Disbursement 2,000.0 0.02

Domestic Loan Principal Payment (378.8) (0.00)

Assumptions :

GDP (trillion IDR) (Y.o.Y) 11,146,943.0

Growth (%) 5.8

Inflation (%) y-o-y 4.4

3-month-SPN (%) 6.0

IDR/USD (average) 11,900

% to GDP

2015

Budget

Description

9

Gross Government Securities Financing 2015

10

DOMESTIC:

Auction:

23 times of conventional securities auction

22 times of islamic securities auction

Non-Auction

Retail bonds, consist of ORI and Sukuk

Retail.

INTERNATIONAL BOND

Issuance of International Bonds as

complement to avoid crowding out in domestic

market and provide benchmark for corporate

issuance, consist of USD, YEN or EURO global

bonds

Maximum issuance international bond 20% from

target gross

Issuing the Government Securities using Front

Loading Strategy in the first semester

Indicative Target

Govt.Securities (net) 277,050

Redemption 135,612

Cash Management 15,000

Buyback 3,000

Govt. Securities (gross) 430,662

Domestic 80%

Retail 9%

Non-Retail 71%

International Bond 20%

In billion IDR

10

Government Securities Performance

(billion Rp) (billion Rp)

Incoming and Awarded Bids for SBN Auctions in 2013 &

2014

Bid to cover ratio of SBN in 2014 reached 2.18

times, slightly higher than 2013 of 2.14 times

Average incoming bid of SUN in 2014 reached IDR23,4 trillion (higher than 2013 of IDR18,9 trillion), while for SBSN reached IDR3,6 trilion (slightly lower than 2013 of IDR3,7 trillion).

Awarded Bid in semester I 2014 reached 56,4% Incoming Bids 2013 & 2014 have similar pattern

65.5 62.8 73.6

64.8

35.2 42.4 45.6 46.8

82.8

39.9

22.7

-0

20

40

60

80

100

Jan Feb Mar April Mei Jun Jul Agst Sept Okt Nov Des

Incoming Bid 2013 Incoming Bid 2014

2.46

2.13

2.75

2.28

1.79

1.98

1.52

1.53

2.35 2.66

3.27

-

0.5

1.0

1.5

2.0

2.5

3.0

3.5

0

20

40

60

80

100

Jan Feb Mar April Mei Jun Jul Agst Sept Okt Nov

Incoming Bid 2014 Awarded Bid 2014 Bid to Cover Ratio 2014 (RHS)

12

2468

10121416182022

Apr'0

8

Jul'0

8

Oct'0

8

Jan'0

9

Apr'0

9

Jul'0

9

Oct'0

9

Jan'1

0

Apr'1

0

Jul'1

0

Oct'1

0

Jan'1

1

Apr'1

1

Jul'1

1

Oct'1

1

Jan'1

2

Apr'1

2

Jul'1

2

Oct'1

2

Jan'1

3

Apr'1

3

Jul'1

3

Oct'1

3

Jan'1

4

Apr'1

4

Jul'1

4

Oct'1

4

Jan'1

5

5Y 10Y 15Y 20Y

7.55 (5Y), 7.73 (10Y), 8.05 (15Y), 8..23

(IDR Trilion)

Global Financial

Crisis

Eurozone sovereign debt

crisis

[In Percentage]

As of Jan 2, 2015

Activities of the domestic bonds are growing Yields of Benchmark Series steadily decrease

Bid Ask Spread 10 Y Government Bond Turn Over 10 Y Government Bond

As of Jan 2, 2015

As of Dec 31, 2014

Secondary Market Performance

Spread 6.9 bps

(ask 7.739%%,

bid 7.808%)

0

10

20

30

40

50

60

70

Jan

-09

Ma

y-0

9

Se

p-0

9

Jan

-10

Ma

y-1

0

Se

p-1

0

Jan

-11

Ma

y-1

1

Se

p-1

1

Jan

-12

Ma

y-1

2

Se

p-1

2

Jan

-13

Ma

y-1

3

Se

p-1

3

Jan

-14

Ma

y-1

4

Se

p-1

4

Jan

-15

5.73 5.31 5.82 7.83

10.31

6.62 7.10 8.42 7.45 6.44

9.27 8.61 8.45 8.23

0.38 0.41 0.96

0.57

1.27

1.18 0.35

0.91 1.04

0.79

0.36 0.41 0.39 0.98

3.07 6.30

9.39 8.69

7.90

7.13 6.95

6.19 8.59 10.76

11.49

9.93 8.81 9.12

-

5.00

10.00

15.00

20.00

25.00

OUTRIGHT REPO BANK REPO BI

13

5.12

7.04

5.15

14.12 12.88

10.75 10.53

-

3.00

6.00

9.00

12.00

15.00

2008 2009 2010 2011 2012 2013 2014

LCY 10 Year

Government

Bonds

Latest Yield YTD Change (BP) MTD Change

(BP)

HK 1.920 +6.1 +6.1

ID 7.859 +6.3 +6.3

JP 0.329 0.0 0.0

KR 2.656 +5.1 +5.1

MY 4.150 +0.3 +0.3

PH 3.863 0.0 0.0

SG 2.280 0.0 0.0

TH 2.729 0.0 0.0

US 2.111 -6.1 -6.1

VN 7.230 0.0 0.0

• Market Watch as of Jan 2, 2014

• Source: Asian Bonds Online

Yield GS on peer’s market (a.o. January 2nd, 2014)

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

22.0

1Y 2Y 3Y 4Y 5Y 6Y 7Y 8Y 9Y 10Y 15Y 20Y 30Y

2 Jan '15 23 Dec '14

2 Dec '14 9 Feb '12

23 Sep '11 27 Oct '08

13 Sep'05

[in percentage]

Tenor 2-Jan-15 23-Dec-14 2-Dec-14 9-Feb-12 23-Sep-11 27-Oct-08 13 Sep'05

1Y 6.40 6.49 6.19 3.30 5.29 19.37

2Y 7.17 7.22 7.00 4.21 6.01 17.35 14.59

3Y 7.43 7.52 7.35 4.33 6.13 19.93

4Y 7.61 7.82 7.55 4.39 6.54 17.17 14.14

5Y 7.62 7.79 7.57 4.44 6.69 17.46 14.96

6Y 7.72 7.92 7.64 4.79 6.81 17.05 15.24

7Y 7.69 7.92 7.66 4.88 7.08 17.06 16.17

10Y 7.77 7.88 7.66 5.02 7.43 20.91 15.75

15Y 8.09 8.24 7.95 5.47 7.83 16.65 14.12

20Y 8.24 8.33 8.07 5.96 8.20 20.27

30Y 8.61 8.66 8.42 6.17 8.29 20.37

14

Ownership of Tradable Domestic Government

Securities

In 2014, foreign investor ownership record the highest percentage, showing their increasing appetite

on the Indonesia’s government securities.

(In IDR Trillion) `

Banks 299.66 36.73% 335.43 33.70% 359.99 33.56% 355.58 31.42% 420.50 35.06% 407.58 33.38% 375.55 31.04% 373.19 30.79%

Govt Institutions (Bank Indonesia*) 3.07 0.37% 44.44 4.47% 30.44 2.84% 51.19 4.52% 0.00 0.00% 0.38 0.03% 41.63 3.44% 42.19 3.48%

Non-Banks 517.53 63.09% 615.38 61.83% 682.31 63.60% 724.86 64.05% 778.90 64.94% 812.93 66.58% 792.78 65.52% 796.71 65.73%

Mutual Funds 43.19 5.27% 42.50 4.27% 44.15 4.12% 45.80 4.05% 46.11 3.84% 45.46 3.72% 45.79 3.78% 45.84 3.78%

Insurance Company 83.42 10.17% 129.55 13.02% 141.28 13.17% 151.36 13.38% 154.09 12.85% 150.78 12.35% 150.60 12.45% 150.66 12.43%

Foreign Holders 270.52 32.98% 323.83 32.54% 360.91 33.64% 403.59 35.66% 447.37 37.30% 481.20 39.41% 461.35 38.13% 461.88 38.11%

Foreign Govt's&Central Banks** 50.06 6.10% 78.39 7.88% 86.09 8.03% 93.59 8.27% 100.57 8.38% 102.61 8.40% 103.42 8.55% 103.42 8.53%

Pension Fund 56.46 6.88% 39.47 3.97% 39.66 3.70% 38.95 3.44% 42.63 3.55% 42.48 3.48% 43.30 3.58% 43.33 3.58%

Securities Company 0.30 0.04% 0.88 0.09% 0.83 0.08% 0.96 0.08% 0.99 0.08% 0.89 0.07% 0.81 0.07% 0.83 0.07%

Individual 32.48 3.26% 45.75 4.27% 31.42 2.78% 28.88 2.41% 31.91 2.61% 30.41 2.51% 30.39 2.51%

Others 63.64 7.76% 46.68 4.69% 49.72 4.64% 52.78 4.66% 58.83 4.90% 60.21 4.93% 60.51 5.00% 63.77 5.26%

Total 820.27 100% 995.25 100% 1,072.74 100% 1,131.63 100% 1,199.39 100% 1,220.90 100% 1,209.96 100% 1,212.09 100%

1) Including ownership of SBSN (government sukuk).

2) Foreign are consisted of Private Banking, Fund/Asset Management, Securities, Insurance, Pension Fund.

3) Others are consisted of Corporation, Individual, Foundation.

*) Since February 8th, 2008, repo transaction of Government Securities to Bank Indonesia was included.

**) Since November 21, 2014, foreign government(s) was included to the same category as foreign central bank(s).

Dec-14 02-Jan-15Nov-14Mar-14Dec-13Dec-12 Jun-14 Sep-14

15

Domestic Institutional Investors

Pension Fund Insurance Company

Mutual Fund

Rp241.67

Rp326.23Rp356.45 Rp361.37

Rp497.03 Rp497.99

Rp545.54Rp567.13

27.09%

24.01%

21.77%

24.11%

19.74%21.02%

12.95%13.98%

0.00%

10.00%

20.00%

30.00%

0

100

200

300

400

500

600

2008 2009 2010 2011 2012 2013 Mar-14 Jun-14

Govt. Securities (GS) Bond

Deposit Stock

Mutual Funds Others

Rp90.11

Rp108.39

Rp141.51 Rp136.53

Rp156.45

Rp169.53 Rp164.15 Rp167.23

27.91% 27.43%

21.90%22.64%

19.68%18.36%

19.46%18.33%

0.00%

10.00%

20.00%

30.00%

0

30

60

90

120

150

180

2008 2009 2010 2011 2012 2013 Mar-14 Jun-14

Govt. Securities (GS) BondDeposit StockMutual Funds Others

45%

37%

33%

28%25%

20%

0%

10%

20%

30%

40%

50%

60%

0

30

60

90

120

150

180

210

240

270

Government Securities (GS) Deposit Bond Stock Others % SBN (RHS)

71.48

110.13

180.28

159

142.97

244.32

Source: Financial Service Authority (OJK), data

processsed

16

Individual & Retail Investors

Retail Govt Securities investors in primary market Individual Ownership

16,561

27,019

37,072

14,601

10,959 10,410

16,107

26,824

20,418

14,295 17,231 15,487 17,606 17,783

34,692

6,412

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

2006 2007 2008 2009 2010 2011 2012 2013 a.o. Oct 30, 2014

ORI SR SBR

3.09%2.82%

2.51%2.27%

4.20%

3.24%3.28%3.12%2.78%

2.69%

2.58%2.41%

3.86%

2.61%2.51%2.51%

0

5

10

15

20

25

30

35

40

45

50

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%Nominal (IDR Trillion) RHS

Percent

17

Foreign Investor Activity 2014

Net Buyer (Seller) - Non Resident Foreign Ownership - Proportion by Tenor

[In IDR Trillion]

Foreign investors mostly dominated by high quality long term investors

(1.49)

(29.29)

1.69

(4.99)

8.06

13.11

(8.99)

(2.27)

4.15

(4.37)

(0.08)

10.13

(1.41)

7.83 9.35

19.52

0.68 2.68

8.44

(0.88)

17.97

4.22

(19.98)

2.81

(1.76)

10.13

23.98

6.08

(0.37)

4.82

16.49 15.77

16.10

20.15

6.43

14.67

15.95

13.17 12.49

21.34

(19.84)

0.53

(0.15)

(0.10)

(0.05)

0.00

0.05

0.10

(40.00)

(30.00)

(20.00)

(10.00)

0.00

10.00

20.00

30.00

Au

g-1

1Se

p-1

1O

ct-1

1N

ov-1

1D

ec-1

1Ja

n-1

2Fe

b-1

2M

ar-1

2A

pr-1

2M

ay-1

2Ju

n-1

2Ju

l-1

2A

ug

-12

Se

p-1

2O

ct-1

2N

ov-1

2D

ec-1

2Ja

n-1

3Fe

b-1

3M

ar-1

3A

pr-1

3M

ay-1

3Ju

n-1

3Ju

l-1

3A

ug

-13

Se

p-1

3O

ct-1

3N

ov-1

3D

ec-1

3Ja

n-1

4Fe

b-1

4M

ar-1

4A

pr-1

4M

ay-1

4Ju

n-1

4Ju

l-1

4A

ug

-14

Se

p-1

4O

ct-1

4N

ov-1

4D

ec-1

4Ja

n 2

-15

Capital Inflows Capital inflows over total foreign holders

10% 12% 8% 5% 6% 7% 7% 7% 6% 6% 5% 5% 5% 5% 5%

5%8%

3% 5% 5% 4% 5% 3% 3% 3% 4% 4% 4% 4% 4%

18%17%

16% 13% 11% 15% 15% 15% 16% 15% 15% 15% 16% 15% 15%

21%

25%

28% 32% 38% 34% 33% 33% 33% 34% 34% 34% 33% 34% 34%

46% 38% 45% 44% 41% 40% 41% 41% 42% 43% 42% 43% 42%43%

43%

30.53% 30.80%32.98% 32.54%

33.64%34.59% 35.72% 35.66% 36.33%36.81%37.30% 37.80%39.41% 38.13%

38.11%

0.00%

20.00%

40.00%

0%

20%

40%

60%

80%

100%

Dec-10 Dec-11 Dec-12 Dec-13 Mar-14 Apr-14 May-14 June 14 July 14 Aug 14 Sep-14 Oct-14 Nov-14 Dec-14 02-Jan-15

>10 >5-10 >2-5 >1-2 0-1 % Foreign Ownership to Total (RHS)

18

Crisis Management Protocol &

Bond Stabilization Framework

Comprehensive Stabilization Framework to Pro-actively

Manage Pressures on Financial Sector

Swap facility arrangements based on international cooperation & Deferred

drawdown option facilities

Implementing Crisis Management

Protocol

Implementing Bond Stabilization

Framework

Enhancing coordination between

government institutions and

continuous dialogue with market

participants

Specific articles in the State Budget

Law that provide flexibility for

Government to take quick mitigation

action if necessary, with Parliament

approval that has to be given within 24

hours

Fiscal Buffers to Prevent and Mitigate Crisis

The FKSSK, Consists of Minister of Finance, BI Governor, Head of Indonesian FSA and Head of

Indonesian Deposit Insurance Corporation, manages the Nationwide Crisis Management Protocol

(CMP) Framework as guidance and procedures for national crisis prevention and mitigation

measures.

The nationwide CMP incorporates the Exchange Rate, Banking, Non-Bank Financial Institution,

Capital Market, Government Bonds Market (SBN), and Fiscal CMPs.

Coordination Meeting is conducted regularly to discuss and assess the current level of Financial

System Stability and current issues related to the financial system

FKSSK has conducted two crisis simulations: Full Dress Simulation (ministerial level) and

activation of pre-emptive instrument (CMIM) at technical level

Crisis Management Protocol

Potential purchase of government bonds by State

Owned Enterprises

Buyback Funds DMO

Budget

SOE

Budget

Other

Gov’t

Budget

Buyback of government bonds by the DMO from the

state budget

Related SOEs

(min. Alert level)

KUN

(State’s General Cash)

(min. Alert level)

Potential purchase of government bonds by the

Treasury Office using the State’s General Cash

(KUN)

Potential purchase of government bonds by the

Indonesia Investment Agency

PIP Investment Funds (min. Alert

Level)

SAL

(min. Crisis Level)

Purchase of government bonds using the

accumulated cash surplus (SAL). Parliament

approval is required

Bond Stabilization Framework

Potential purchase of government bonds by BPJS

Workforce and BPJS Healthcare

BPJS

Budget*

BPJS Workforce and BPJS

Healthcare funds

*Based on MoU between MoF and BPJS (Social Security Agency) Workforce & BPJS Healthcare

that has been signed on Sept 1, 2014.

1

2

3

1

2

20

Debt Outstanding & Risk Profile

Maturity Profile Central Gov’t Debt as of End of Nov’ 2014

Maturity Profile of Central Debt Government by Currency (in trillion Rp)

Maturity Profile of Central Government Debt by Instruments (in trillion Rp)

25.9%

74.1%

Loan

Gov't Sec

14

13398 107 101

142

93 97117

99

163

4322

48 5374

29 31 47 53 7025 10

42 478 10

150

17

64

63 57 56

55

51 4439

34

29

25

21

18 1513

12 1212 11

7

4 32 1

1 1

5

020406080

100120140160180200220240

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

-205

5

Gov't Sec Loan

15

12188 89

6696

62 5274 69

121

4322

48 5374

29 31 47 53 70

6 10 23 23 8 10

8017

75

73 7590

101

82 9082

65

71

2521

18 1513

12 1212 11

7

243 20 25

1 1

74

020406080

100120140160180200220240

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

-205

5

Foreign Denominated

Domestic Denominated 42.9%

57.1%

ForeignDenominated

DomesticDenominated

22

Outstanding Central Gov’t Debt by Instrument

Nominal %

a. Foreign Loan (in billion USD) 65.0 68.6 68.4 63.6 58.4 55.0 25.7%

Bilateral 41.3 42.3 42.1 37.2 31.2 27.7 13.0%

Multilateral 21.5 23.2 23.5 23.8 23.6 23.5 11.0%

Commercial 2.2 3.0 2.8 2.5 3.2 3.7 1.7%

Suppliers 0.1 0.1 0.1 0.0 0.0 0.0 0.0%

b Domestic Loan (in billion USD) - 0.0 0.1 0.19 0.2 0.2 0.1%

c. Government Securities (in billion USD) 104.2 118.4 131.0 140.8 136.3 158.6 74.2%

Foreign Currency Denominated 15.2 18.0 21.6 27.4 32.8 36.7 17.2%

Rupiah Denominated 89.0 100.4 109.4 113.4 103.5 121.9 57.0%

Total Central Government Debt

(in billion USD)169.2 187.0 199.5 194.89 213.9

Total Central Government Debt

(in trilion IDR)1,590.9 1,681.7 1,808.9 2,375.5 2,608.1

Exchange Rate Assumption (IDR/USD1) 9,400.0 8,991.0 9,068.0 12,189.0 12,196.0

GDP (in trillion IDR) 5,613.4 6,422.9 7,427.1 9,084.0

Debt to GDP Ratio 28.3% 26.2% 24.4% 24.0% 26.2%

Nov'14

2011 2012 2013Description 2009

9,670.0

2010

1,977.7

204.5

8,241.9

23

Outstanding Central Gov’t Debt by Currency

2009 2010 2011

Original Currency

IDR (in trillion) 836.3 902.6 993.0 1,098.0 1,263.9 1,489.2

USD (in billion) 37.1 39.6 43.9 49.8 56.8 60.9

JPY (in billion) 2,713.8 2,689.8 2,589.8 2,498.8 2,395.3 2,258.0

EUR (in billion) 6.0 5.4 5.0 4.5 4.2 5.2

Other currencies

Equivalent in Billion USD

IDR 89.0 100.4 109.5 113.5 103.7 122.1 57.1%

USD 37.1 39.8 43.9 49.8 56.8 60.9 28.5%

JPY 29.4 33.1 33.4 29.1 22.8 19.1 8.9%

EUR 8.6 7.2 6.4 6.0 5.8 6.5 3.1%

Other currencies 5.2 6.5 6.3 6.1 5.8 5.2 2.4%

Total Eq. in Billion USD 169.2 187.0 199.5 204.5 194.9 213.9

Equivalent in Trillion IDR

IDR 836.3 902.8 993.0 1,098.0 1,263.9 1,489.2

USD 348.6 357.6 397.9 481.9 692.0 743.2

JPY 276.0 297.6 302.5 281.2 278.3 233.1

EUR 80.7 65.0 58.5 57.5 71.1 79.7

Other currencies 49.1 58.6 57.1 59.1 70.2 62.9

Total Eq. in Trillion IDR 1,590.7 1,681.7 1,808.9 1,977.7 2,375.5 2,608.1

Foreign Currency Portion 47.4% 46.3% 45.1% 44.5% 46.8% 42.9%

Exchange Rate Assumption USD/IDR 9,400 8,991 9,068 9,670 12,189.0 12,196.0

Nov-14

-----------------------Multiple Currencies -----------------------

20132012

24

Interest Rate Risk Steadily Declining Exchange Rate Risk on Downward Trend

Long Average Years to Maturity Debt Maturity Evenly Spread

Reduction in Central Government Debt Portfolio Risk

22.020.3

18.816.2 16.0

14.8

28.226.1 25.9

22.5 23.220.9

2009 2010 2011 2012 2013 Q3-2014

Interest Rate Risk

Variable rate ratio [%] Refixing rate [%]

13.4 12.1 11.0 10.6 12.2 11.4

47.4 46.2 45.1 44.446.7

43.3

2009 2010 2011 2012 2013 Q3-2014

Exchange Rate Risk

FX Debt to GDP ratio (%) FX Debt to total debt ratio (%)

9.7

9.5

9.3

9.7

9.6

9.9

2009 2010 2011 2012 2013 Q3-2014

Average Time To Maturity (ATM)-Years

Average Time to Maturity (in percentage)

7.6 7.1 8.2 7.2 8.6 8.3

20.3 20.822.7 21.5 21.8 20.8

33.2 34.2 34.632.4 33.4 33.9

2009 2010 2011 2012 2013 Q3-2014

Debt Maturing in 1, 3 and 5 Years

Maturity debt portion < 1 year (%) Maturity debt portion < 3 year (%)

Maturity debt portion < 5 year (%)

Risk indicator in good condition, even there is pressure from rupiah depreciation

Risk indicator

shows that there are improvements in interest rate, risk and stability in exchange and refinancing risk

25

END OF PRESENTATION Directorate General of Debt Management Ministry of Finance of Republic of Indonesia Directorate of Government Debt Securities Frans Seda building, 4th floor, Jl. Wahidin Raya No. 1, Jakarta Pusat – Postal Code: 10710 Phone: +6221 3810175 Fax. : +6221 3846516 Site: www.djpu.kemenkeu.go.id