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Romania wants to issue eurobonds of 300 million euro, maturity 4 years on August 14th

The ministry of public finances (MFP) will issue on August 14th by public subscription Eurobonds of 300 million euro, with maturity of 4 years and a rate of the coupon of 5.25%, according to the data published by the central bank. The nominal value of the bonds is 1 million euro.

This year, the finances issued state bonds of 48.5 million lei, almost four times more than in 2008, most of them being with maturity at 6 months. On July 23rd, the state secretary Bogdan Dragoi said that the ministry of public finances wants to continue the issuing of the Eurobonds on the foreign market in September, as the risk bonus (CDS) of Romania will be at the present level, namely 300 points.« We will try to prolong the maturity of the loans by the emission of eurobonds, by taking into consideration that the beginning of next year the ministry of finances will have a loan on a short term" Dragoi explained. At the beginning of June, Dragoi stated that Romania could have, during the last period of this year, an emission of Eurobonds of at least 500 million euro, with maturity between 5 and 10 years. Romania has also issued in June 2008 a eurobonds emission, selling bonds of 750 million euro.On the other hand, MFP got almost one billion euro from the banks, through an agreement " club loan" which has the advantage of being cheap. The government assumed one budgetary deficit target of 4.6% out of GDP - or 24.3 billion lei - for this year, following the financing agreement with IMF. IMF fixed for Romania budgetary deficit targets: at most 14.5 billion lei at the end of the second quarter and maximum 18.6 billion lei for the third quarter. The budgetary deficit reached 2.71% of GDP, 14.38 billion lei respectively at mid-year, a little under the IMF target, of 2.73% of GDP. The minister of public finances, Gheorghe Pogea stated last week that he will negotiate with IMF a budgetary deficit at least equal to the drop of income in the economy, saying that " the level of income for Q1 was less by 5.1% against the same period of last year and it reflects the effects of the economic and financial crisis on the private capital especially". The IMF representatives stated to the Romanian officials that they estimated the Romanian economy will contract by 8% this year and thus they will agree to a budgetary deficit of 8% of GDP, if the government reduces the expenditure.

Sursa: http://www.actmedia.eu

Tags: finances billion budgetary deficit romania years eurobonds million euro maturity mfp

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