BRATISLAVA, February 18, (WEBNOVINY) – In this Thursday’s syndicated bonds tap, Slovakia managed to borrow at lower rate, than some countries with better ratings refinance their debt. „The achieved guidance of 80 basis points over mid-swaps is lower, than for example Italy or Slovenia have,” said Viktor Polhorsky, the head of Slovenska Sporitelna balance management department. Slovenska Sporitelna, a unit of Erste, CSOB, Slovak unit of KBC and VUB, unit of Intesa SanPaolo were mandated by Slovakia’s debt agency ARDAL to manage the issue.
Slovakia sold syndicated bonds worth 1.25 billion euro on Thursday. Bonds worth 729.3 million euro are heading into the portfolios of foreign investors. The overall demand of the investors for the originally six-year bond maturing in February 2016 reached 1.897 billion euro. The state was selling the bonds at an interest rate of 3.5970 percent p.a.. “A huge demand and excellent quality of the bids emphasized the interest in good credit of Slovakia from the international investors. It also confirmed diverting of the most solvent countries of the central and eastern Europe and Slovakia from the peripheral countries of Europe,” Slovakia’s debt agency ARDAL commented on the sale.
Recent syndicate tap extends the issue of originally six-year bond maturing in February 2016. “This important transaction is the third syndicated issue of Slovakia under Slovak law and the first extension of an existing issue of previously floated local bonds through auctions,” stated ARDAL.
Slovakia could raise almost half of this year’s national debt refinancing requirement through issues of syndicated bonds. The overall need for debt refinancing this year is 8.5 billion euro. According to ARDAL head Daniel Bytcanek, they could sell up to 4 billion euro of government debt through syndicated bonds this year.
„Overall, we plan to sell through syndicated bonds of about 4 billion euro and the rest through auctions in the domestic market which is open for foreign investors,“ he said for SITA news agency. He specified that in 2011, Slovakia could launch two or three syndicated issues in the spring and autumn. „The actual date of bond issues will depend in particular on the situation on financial markets,“ Bytcanek said in January of this year.
Syndicated bonds were an important part of refinancing the debt in the last year, when sale included also the 3.5 billion euro from a syndicated sale of two issues of benchmark
Last year, ARDAL raised EUR 7.094 billion in bond sales to cover the state debt and to provide liquidity. This represented a significant increase from the EUR 4.208 billion obtained in 2009. The increase was caused by a higher need to refinance the state budget deficit. Last year’s sale included also the EUR 3.5 billion from a syndicated sale of two issues of benchmark bonds from April and October of last year. The agency sold T-bills worth EUR 2.421 billion last year, too, up from EUR 1.259 billion a year ago.
SITA