IndONIA (Indonesia Overnight Index Average)
IndONIA is a money market benchmark rate. Calculated periodically, IndONIA
is available to market participants for use as a reference to determine
lending rates as well as set prices and measure the performance financial
instruments. IndONIA is the average interest rate index for unsecured
overnight interbank rupiah money market transactions.
IndONIA is calculated based on the average interest rate for unsecured
overnight rupiah lending reported by all banks to Bank Indonesia.
Therefore, IndONIA is the transaction interest rate based on market
transactions. IndONIA is determined using the volume-weighted average of all
transaction data on a particular day, as reported by the banks to Bank
Indonesia through the commercial bank daily reporting system between 07:00
WIB and 18:00 WIB (with an online correction window until 19:00 WIB).
Bank Indonesia began publishing IndONIA each business day at 19:30 WIB on
its official website from 1st August 2018.
IndONIA is expected to replace the overnight JIBOR as the money market
benchmark rate. As of 2nd January 2019, Bank Indonesia no longer
publishes the overnight JIBOR, with existing financial contracts using the
overnight JIBOR as a reference expected to transition to IndONIA as the
latest reference for the overnight tenor.
A brief explanation of IndONIA is as follows:
|
No |
Subject
|
Description
|
|
1 |
Publication Time
|
19.30 WIB
|
|
2 |
Tenor
|
Overnight |
|
3 |
Calculation Method
|
Volume-weighted average
|
Provisions concerning IndONIA are contained in Bank Indonesia Regulation
(PBI) No. 20/7/PBI/2018, dated 24th July 2018, concerning the Indonesia
Overnight Index Average (IndONIA) and Jakarta Interbank offered Rate
(JIBOR).
Information about IndONIA
Financial Market Development Department
Telp : (021) 2981-4013, 2981-4897
Fax : (021) 2311-325, 3504-296
Email : indonia.jibor@bi.go.id
In order to increase the use of IndONIA as Alternative Reference Rate (ARR)
to calculate non-overnight term rates which among other things can be done
by compound averaging the IndONIA rates throughout certain period, Bank
Indonesia publishes Compounded IndONIA. Compounded IndONIA is a term rate
calculated by the compounded average interest of IndONIA throughout a
certain period.
Bank Indonesia
calculates Compounded IndONIA based on IndONIA published on Bank Indonesia's
website using a fixed day structure basis, from IndONIA in the beginning of
the interest period to 1 (one) day before the publication date of Compounded
IndONIA.
Compounded IndONIA is published
for standard tenors of 30, 90, 180 and 360 calendar days on Bank Indonesia's
website, each business day at 08.00 WIB starting on February 1, 2023. The
responsibility to bear any consequences arising from the use of Compounded
IndONIA published on Bank Indonesia's website entirely lies with the
transacting party.
Brief description of Compounded IndONIA is as
follows:
|
No |
Subject
|
Description
|
|
1 |
Publication Time
|
08.00 WIB (GMT+7)
|
|
2 |
Tenor
|
30, 90, 180, and 360 calendar days. |
|
3 |
Calculation Method
|
Compounded average interest of IndONIA published on Bank
Indonesia's website throughout interest period.
|
IndONIA Index is an index representing accumulated value of compound
interest of IndONIA, daily calculated by the Bank of Indonesia. IndONIA
Index is calculated based on the values of IndONIA and IndONIA Index
published on previous working day in Bank Indonesia’s official website, with
the initial value set to 1.000000000 on January 2, 2019. IndONIA index is
published on the Bank of Indonesia's website each business day at 8:00 AM
WIB starting on February 1, 2023.
Market
participants can use the IndONIA Index to calculate the Compounded IndONIA
value of certain periode. But it is important to note that the value of
standard tenor Compounded IndONIA calculated using IndONIA Index may differ
from the value of standard tenor Compounded IndONIA published in Bank
Indonesia’s website due to differences in calculation methods. The
responsibility to bear any consequences arising from the use of IndONIA
Index published on Bank Indonesia’s website entirely lies with the
transacting party.
Calculation examples
of Compounded IndONIA and IndONIA Index can be seen in PADG
No.24/18/PADG/2022 about Amendments to PADG No. 20/19/PADG/2018 about
Indonesia Overnight Index Average(IndONIA) and Jakarta Interbank Offered
Rate (JIBOR)
Guide to the use of IndONIA
on financial instruments issuances and/or transactions can be seen in the
User’s Guide to IndONIA.
JIBOR (Jakarta Interbank Offered Rate)
JIBOR is a money market benchmark rate. Calculated periodically,
JIBOR is available to market participants for use as a reference to
determine lending rates as well as set prices and measure the
performance financial instruments. JIBOR is the average indicative
unsecured lending rate offered by contributor banks to other contributor
banks for rupiah lending in Indonesia with a tenor longer than
overnight.
JIBOR is determined by Bank Indonesia based on the indicative offered
rates quoted by Contributor Banks to Bank Indonesia during the
submission window from 07:00 WIB to 09:30 WIB (with an online correction
window until 09:45 WIB). Furthermore, JIBOR is calculated using a
simple average of the quotations submitted by Contributor Banks after
excluding 15% of the highest and 15% of the lowest offered rates.
Bank Indonesia publishes JIBOR on its official website each business day
at 10:00 WIB, consisting of overnight, 1-week, 1-month, 3-month, 6-month
and 12-month tenors.
To enhance JIBOR credibility as a money market reference rate, Bank
Indonesia has introduced several refinements. As of 2nd January
2019, JIBOR is determined referencing transaction data based on good
governance, which is expected to reflect actual market rates in line
with international best practices as stipulated in the IOSCO Principles
for Financial Benchmarks published by the International Organisation of
Securities Commissions (IOSCO).
Enhanced money market benchmark rate credibility is expected to reduce
the complexity of financial contracts by facilitating standardisation
through the use of reference interest rates for debt instruments and/or
lending based on floating interest rates, rupiah interest rate
derivatives and for the evaluation of financial instruments.
As of 2nd January 2019, Bank Indonesia no longer publishes the overnight
JIBOR. Consequently, JIBOR consists of five tenors, namely 1-week,
1-month, 3-month, 6-month and 12-month tenors, published daily on Bank
Indonesia's website at 11:00 WIB of each business day.
A brief explanation of IndONIA is as follows:
| No |
Subject
|
Information
|
| 1 |
Publication Time
|
10.00 WIB
From
2nd Januari 2019:
11.00 WIB
|
2
|
Tenor
|
Overnight, 1-week, 1-month, 3-month, 6-month and
12-month
From 2nd January 2019:
1-week, 1-month, 3-month, 6-month and 12-month
|
3
|
Day Count
Convention
|
Actual/360 |
4
|
Calculation Method
|
Simple average after
excluding 15% of the highest and 15% of the lowest
offered rates.
|
Provisions concerning JIBOR
are contained in Bank
Indonesia Regulation (PBI)
No.20/7/PBI/2018
dated 24 Juli 2018
concerning the Indonesia
Overnight Index Average andJakarta Interbank Offered Rate.
Information about IndONIA
Financial Market Development Department
Telp: (021) 2981-4013, 2981-4897
Fax: (021) 2311-325, 3504-296
Email: indonia.jibor@bi.go.id
