26 November 2020
On 5 November 2020, Bank Indonesia (“BI”) and the Monetary Authority of Singapore (“MAS”) announced the extension of the US$10 billion bilateral financial arrangement for another year. This extension has been endorsed by Indonesian President Joko Widodo and Singapore Prime Minister Lee Hsien Loong, and will support monetary and financial stability in both countries amid the Covid-19 pandemic.
The arrangement comprises two agreements:
- A local currency bilateral swap agreement that allows for the exchange of local currencies between the two central banks of up to S$9.5 billion or IDR100 trillion (about US$7 billion equivalent); and
- A bilateral repo agreement of US$3 billion that allows for repurchase transactions between the two central banks to obtain US$ cash using G3 Government Bonds as collateral.
The bilateral financing arrangement was established in November 2018, following the Singapore-Indonesia Leaders’ Retreat, where the leaders asked BI and MAS to establish the arrangement to build confidence in each other’s economies. The arrangement was extended for a year in November 2019.