Romania borrowed two billion dollars on the international markets through two issues of 10-year and 30-year bonds respectively, according to a release of the Ministry of Public Finance (MFP).
'The offer was oversubscribed more than five times, which allowed cutting down the yields from the initial offer. Thus, Romania has borrowed one billion dollars on 10 years, at 5.021% yield (4.875% coupon), and one billion dollars on 30 years, at 6.258% yield (6.125% coupon),' states the release.
According to this source, it is Romania's first issue of 30-year bonds in dollars on the international markets.
'Thus, Romania enters the category of mature emerging economies, which finance their debts on the free markets, on the long term, a sign of increased investors' trust in the fundamentals and perspectives of Romanian economy and of predictability of the economic policies,' the document adds.
In February 2013, Romania drew 1.5 billion US dollars from the international capital market, for a period of 10 years and a half, at a net interest rate of 4.5% per annum. Meanwhile, however, 'the benchmark interest rate for 10-year bonds issued by the US Treasury has climbed 86 basis points compared to February 2013, while Romania's risk premium has fallen 36 basis points, in the context of positive macroeconomic results,' according to MFP's release.
Romania's bond issues were managed by BNP Paribas , Citibank, and JP Morgan.
The Government of Romania decided at the end of last year to supplement the maximum amount that can be borrowed by the state from international markets in the medium term under the "Medium Term Notes" program from 8 billion euros to 15 billion euros. According to a Government Decision, the new ceiling will cover financing needs by security issues on international capital markets for the period 2014-2016. AGERPRES