The Slovenia Times

Slovenia to buy back another US$1bn in bonds

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To optimise debt cost, it already bought back US$1.25bn-worth of bonds in May.

The tender is open until 30 August, with the treasury offering repayment in eight days, the Finance Ministry has said.

The volume of interest in the buyback tender is expected to be announced on 31 August, pending a possible extension on the 30 August deadline, with the price to be determined later the same day.

The country issued bonds on the US market in a time of economic turmoil but, since implementing reforms and avoiding an international bailout, has seen yields on its debt fall significantly.

Slovenia conducted three issues of dollar-denominated bonds in a period when economic conditions meant it was virtually locked out of the euro bond market.

In the autumn of 2012 it raised US$ 2.25bn through an issue of 10-year bonds with a coupon rate of 5.5%. This was followed by a US$ 2.5bn issue with a coupon rate of 5.85% in May 2013.

In the final debt action on the US market in February 2014, the country conducted a dual-tranche issue of five- and ten-year bonds worth a combined US$ 3.5bn. The ten year bonds, which are subject to the buyback, carry a coupon rate of 5.25%.

In May the country bought back US$ 1.25bn-worth of dollar-denominated bonds to optimise the cost of the debt, having brought down the total nominal value of dollar-denominated bonds to US$ 5.5bn.

To finance the buyback and at the same time extend the average maturity of debt, Slovenia issued in May EUR 750m worth of bonds with maturity in July 2025 that have a coupon rate of 2.125% and EUR 500m worth of bonds with maturity in March 2032 and a coupon rate of 2.25%.

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