Treasury completes borrowing plan for 2018 with €350 million Eurobond issue

Taking advantage of the favorable market situation, the Treasury of Latvia on Wednesday issued €350 million worth of Eurobonds, successfully completing its 2018 borrowing plan which provided for raising €1 billion on international financial markets for this year’s financing needs and the repayment of government debt scheduled for the first half of 2019.

LETA was told at the Treasury that by consistently and timely borrowing on financial markets for several years, the Treasury has managed to refinance government debt for historically lowest interest rates, saving a significant amount of budget funds in the long term, including by reducing interest expenditure in 2019 by €16 million in comparison with the panned figure.

In Wednesday’s transaction Latvia issued additional bonds to the ten-year bond issue that was launched in May 2018 and matures in 2028, raising €150 million. The bonds carry a 0.997 percent yield rate and a coupon of 1.125 percent. The Treasury also issued additional bonds to the 30-year bond issue, launched in February 2017 and maturing in 2047, raising €200 million. The yield rate of these bonds is 1.861 percent and a coupon of 2.25 percent.

Around 70 investors, predominantly from European countries, were involved in the transaction. The bond issue was arranged by Citi, JP Morgan and Natixis.

In May 2018, Latvia in cooperation with the aforementioned banks raised €650 through two Eurobonds issues of the same terms to maturity – new ten-year bonds worth €350 million and 30-year bonds worth €300 million.

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