Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE IN INDONESIA ASIA PACIFIC UNION OF HOUSING FINANCE INTERNATIONAL CONFERENCE NEW DELHI, JAN 30 th – 31 st, 2012 PREPARED BY: PT. SARANA MULTIGRIYA FINANSIAL (Persero) INDONESIA

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR AGENDA COUNTRY HIGHLIGHTS OF INDONESIA HOUSING FINANCE MARKET ABOUT SMF CONCLUSION

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR COUNTRY HIGHLIGHTS OF INDONESIA

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR COUNTRY HIGHLIGHTS OF INDONESIA Indonesia is the biggest archipelago country in South East Asia comprising of islands. Total population in 2010 showed people Jakarta is the capital city of Indonesia. A GLANCE OF INDONESIA

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR COUNTRY HIGHLIGHTS OF INDONESIA Source : BPS (Biro Pusat Statistik) 2011 ( *Estimation Even though growth showed relative decline during the global crisis, bottoming in 2009 at 4.6%, the economy rebounded in 2010 at 6.1% and 2011 at 6.5% which reflects a solid fundamental economics. GDP GROWTH & POPULATION

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR COUNTRY HIGHLIGHTS OF INDONESIA Source : Bank Indonesia 2011 ( Inflation continues to decrease followed by a decrease on BI Rate. Lending rate which uses BI rate as its benchmark decrease at a slower rate. * Central Bank of Indonesia

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET More than 90% of mortgages are originated by 10 banks as major players until 2011 Source: The Indonesian Banking Statistics (SPI), 2011 MORTGAGE MARKET

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET Source : HDFC, 2009 The ratio of mortgage portfolio to GDP in Indonesia still very low. Compare with total GDP, the proportion of housing loan portfolio figures around 2% where country like China and Malaysia have higher percentage 20% and 29% MORTGAGE TO GDP

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET Source PSPI, BI, Ministry of Housing, REI, APERSI, Spire estimation & Analysis(*) Sales of housing experience healthy growth since significant drop in Total sales at the end of 2011 peek around 242,000 houses. This sales potrays the growth in new constructed houses. HOUSING SALES

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET Source : Apersi, Kemenpera, PSPI, Deputy Ministrer of Infrastructure Total housing demand: 1,230,000 units per year HOUSING DEMAND

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE MARKET The big gap between supply and demand of houses remains. 1.The total demand of 1.23 million units from: Current Indonesias Housing backlog over 8.6 million units, requiring approx. 430,000 units per year to be built in 20 year, Housing needs from population growth is recorded at 800,000 units per year 2.Supply of New Housing Construction of approx. 240,000 units in 2011 but still almost always below housing demand. SUPPLY AND DEMAND DEMAND

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF SMF PROFILE 1.PT. Sarana Multigriya Finansial (Persero) (SMF), established on July 22, 2005, as a Secondary Mortgage Corporation – wholly owned by the government. 2.SMFs mission is to create the affordability for Indonesian Families to own a decent homes. 3.Initial Paid Up Capital of IDR 2 trillion 4.Total assets of IDR 4,8 trillion as of 31 December 2011

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF To Develop secondary mortgage market Liquidity Facility Securitization Securitization Guarantor (Mortgage & Financial) Provide Housing Finance Information System (HFIS) Facilitator Catalysator To Build secondary mortgage market SMF ROADMAP

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF Liquidity Facility Program provide medium to long term loans for mortgage lenders. Securitization Program provide a mechanism of sales of mortgage loans and issue of mortgage backed securities. Guarantee Program provide guarantee for obligation / mortgage backed securities issued by mortgage lenders. Support Programs -Provide a guidence and mortgage document standard -Education and training programs -Socialization (workshop, seminar, product introductions) THE COMPANYS PROGRAMS

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF SIX-YEARS HIGHLIGHTS

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR - - ABOUT SMF The first mortgage securitization in Indonesia was succesfully concluded in 2009 and followed by other transaction every year REALIZATION FUND FLOW BY YEAR

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR ABOUT SMF The used of capital market fund continues to increase housing sector with accumulated volume in 2011 of 5,26 trililion IDR ACCUMULATIVE FUND FLOW TO THE PRIMARY MARKET

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR CLOSING REMARKS 1. As the population continue to grow, the needs for housing continue to rise. To build a robust systems of housing finance is critical for Indonesia. 2.Through strengthening the primary mortgage market and developing secondary mortgage market, availability of sustainable medium to long term fund will eventually increase affordability 3.The first mortgage securitization in Indonesia was concluded in 2009 and followed with other transactions. 4.To develop a strong housing finance in Indonesia, it still required government and stake holders supports. i.e: government regulations.

Facilitates funds flow from CAPITAL MARKET to HOUSING SECTOR HOUSING FINANCE IN INDONESIA