Indonesia Hires Banks to Arrange $2 Billion Bond Sale

Indonesia's government hired Barclays Capital, HSBC Holdings Plc and Lehman Brothers Holdings Inc. to help sell as much as $2 billion of dollar bonds, according to two people with direct knowledge of the plan.

The banks plan to market the securities early next year, said the people, who declined to be identified because the information isn't public. Indonesia will sell debt maturing in 10 years and 30 years, the people said. It would be the nation's biggest overseas debt sale since March 2006, when it raised $2 billion.

Indonesia, a net exporter of energy, is seeking to sell debt overseas after losses in the U.S. subprime mortgage market prompted investors to demand higher premiums for buying the riskier, high-yield debt. Rising oil prices, a growing economy and shrinking budget deficit would likely support investor demand for the nation's securities.

``There are investors trying to put their money to work after several months of market hiatus since July,'' said Ping Chew, a managing director at Standard & Poor's in Singapore. ``Recent high-yield deals have been reasonably well received, as emerging market debt becomes a respectable asset class.''

Rahmat Waluyanto, director general of the Indonesian finance ministry's debt management unit, didn't answer calls to his mobile phone or reply to a text message.

``Let our team led by Rahmat announce the details,'' Finance Minister Sri Mulyani Indrawati told reporters in Jakarta today.

Spokeswomen at Barclays, Lehman and HSBC in Hong Kong declined to comment.

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