SHORT-TERM BANK LOANS AN CURRENT MATURITIES OF LONG-TERM BORROWINGS continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2016 and For the Nine-Month Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 52

16. LONG-TERM BORROWINGS continued

a. Two-step loans continued Lenders Currency Principal payment schedule Interest payment period Interest rate per annum Overseas banks US Semi-annually Semi-annually 3.85 Rp Semi-annually Semi-annually 8.25 Yen Semi-annually Semi-annually 2.95 The loans were intended for the development of telecommunications infrastructure and supporting telecommunications equipment. The loans are due on various dates through 2024. The Company had used all facilities under the two-step loans program since 2008. Under the loan covenants, the Company is required to maintain financial ratios as follows: a. Projected net revenue to projected debt service ratio should exceed 1.2:1 for the two-step loans originating from Asian Development Bank “ADB”. b. Internal financing earnings before depreciation and finance costs should exceed 20 compared to annual average capital expenditures for loans originating from the ADB. As of September 30, 2016, the Company has complied with the above-mentioned ratios. Refer to Note 32 for details of related party transactions. b. Bonds and notes September 30, 2016 December 31, 2015 Outstanding Outstanding Bonds and notes Currency Original currency in millions Rupiah equivalent Original currency in millions Rupiah equivalent Bonds 2010: Series B Rp - 1,995 - 1,995 2015: Series A Rp - 2,200 - 2,200 Series B Rp - 2,100 - 2,100 Series C Rp - 1,200 - 1,200 Series D Rp - 1,500 - 1,500 Medium Term Notes “MTN” GSD Series A Rp - 220 - 220 Series B Rp - 120 - 120 Finnet MTN I Rp - 178 - 200 Promissory notes PT Huawei US - - 1 14 PT ZTE Indonesia “ZTE” US 1 1 14 Total 9,514 9,563 Unamortized debt issuance cost 14 15 9,500 9,548 Current maturities Note 15b 32 49 Long-term portion 9,468 9,499 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2016 and For the Nine-Month Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 53

16. LONG-TERM BORROWINGS continued

b. Bonds and notes continued i. Bonds 2010 Bonds Principal Issuer Listed on Issuance date Maturity date Interest payment period Interest rate per annum Series A 1,005 The Company IDX June 25, 2010 July 6, 2015 Quarterly 9.60 Series B 1,995 The Company IDX June 25, 2010 July 6, 2020 Quarterly 10.20 Total 3,000 The bonds are secured by all of the Company’s assets, movable or non-movable, either existing or in the future Note 9c.ix. The underwriters of the bonds are PT Bahana Securities “Bahana”, PT Danareksa Sekuritas, and PT Mandiri Sekuritas and the trustee is PT CIMB Niaga Tbk. The Company received the proceeds from the issuance of bonds on July 6, 2010. The funds received from the public offering of bonds net of issuance costs, were used to finance capital expenditures which consisted of wave broadband bandwidth, softswitching, datacom, information technology and others and infrastructure backbone, metro network, regional metro junction, internet protocol, and satellite system and to optimize legacy and supporting facilities fixed wireline and wireless. As of September 30, 2016, the rating of the bonds issued by PT Pemeringkat Efek Indonesia Pefindo is idAAA stable outlook. Based on the indenture trusts agreement, the Company is required to comply with all covenants or restrictions, including maintaining financial ratios as follows: 1. Debt to equity ratio should not exceed 2:1. 2. EBITDA to finance costs ratio should not be less than 5:1. 3. Debt service coverage is at least 125. As of September 30, 2016, the Company has complied with the above-mentioned ratios. 2015 Bonds Principal Issuer Listed on Issuance date Maturity date Interest payment period Interest rate per annum Series A 2,200 The Company IDX June 23, 2015 June 23, 2022 Quarterly 9.93 Series B 2,100 The Company IDX June 23, 2015 June 23, 2025 Quarterly 10.25 Series C 1,200 The Company IDX June 23, 2015 June 23, 2030 Quarterly 10.60 Series D 1,500 The Company IDX June 23, 2015 June 23, 2045 Quarterly 11.00 Total 7,000 The bonds are secured by all of the Company’s assets, movable or non-movable, either existing or in the future Note 9c.ix. The underwriters of the bonds are Bahana, PT Danareksa Sekuritas, PT Mandiri Sekuritas, and PT Trimegah Sekuritas and the trustee is Bank Permata.