Fitch Maintains INA Rating at BBB With Negative Outlook

Fitch Ratings has kept the Indonesia Investment Authority (INA) long-term foreign- and local-currency issuer default ratings at BBB, with a negative outlook. The agency also kept INA's short-term foreign-currency issuer default rating at F2. Fitch Senior Director and Primary Rating Analyst Paul Norris said the support from the Indonesian government was a major factor in the ratings.

Fitch gave the government a support score of 45 out of 60, indicating a high likelihood of support if needed. This reflects Fitch's belief in the government's commitment to backing INA. Fitch said INA's ratings are in line with those of the Indonesian government, which Fitch has rated BBB with a negative outlook. INA's negative outlook mirrors the government's view.

Fitch also praised INA's governance and oversight structures, noting that INA reports directly to the president and its supervisory board includes the finance minister and head of the state-owned enterprise regulatory body. INA's business activities require approval based on key performance indicators and quarterly reporting. A default by INA could impact financing availability and cost for the Indonesian government and other state-owned companies, and weaken investor confidence in Indonesia's investment climate.