Government Will Not Restrict Number of Primary Dealers
Tuesday, 23 January, 2007 | 17:42 WIB

TEMPO Interactive, Jakarta: The Department of Finance will not limit the number of primary dealers of State Bonds. Primary dealers will be as many as possible and varied to avoid a cartel system: control of state bonds trading by certain parties.

“In neighboring countries, the amount is less than 15. It was arranged this way to avoid the cartel system,”Director of State Bonds Management at the Department of Finance Bhismantara Widjaja told reporters yesterday (01/22) in Jakarta.

He explained that, with regard to the Finance Minister’s Regulation Number 144/PMK.8/2006 dated 29 December 2006, primary dealers, expected to be established by March 2007, consist of banks and share companies. Both must have joined the State Bond auction within the last year. It means that today, companies that may become primary dealers of State Bonds include 31 banks and share companies.

According to him, in order to become primary dealers, banks must meet the core capital of Rp1 trillion. In addition, share companies must have net working capital that is adjusted with average dailies in the last one month with a minimum of Rp200 billion.

“We hope that all of them can be the primary dealers. However, it will all depend on who will be interested in and meet the conditions,” he said.

Primary dealers are in line with the government's plan of developing long- and short-term State Bonds secondary market. The existence of primary dealers is important so that it is creates in the bonds secondary market a benchmark yield curve. The curve will be the basis for market players to offer or gain State Bonds.

Anton Aprianto