January 19 (SeeNews) - Bulgaria raised 1.5 billion euro ($1.61 billion) in an oversubscribed 10-year Eurobond issue with a fixed annual coupon of 4.5%, the finance ministry said on Thursday.
The government paper was issued at a yield of 4.78% on the Luxembourg Stock Exchange on Tuesday, with 248 investors subscribing for a total of 7.3 billion euro without a road show which usually precedes a placing, the ministry said in a press release.
The bond sale is part of Bulgaria's 12 billion euro global medium-term issuance programme. Proceeds will be mainly used to finance a 3 billion levs ($1.65 billion/1.53 billion euro) Eurobond maturing on March 26.
Investors from North America acquired the largest portion of the Eurobonds, or 26%, followed by investors from the UK and Ireland with 23%. Germany, Austria and Switzerland accounted for 15% of investors, while 11% came from the CEE region. The biggest portion of sovereign debt was purchased by asset management funds - 59% of the issuance, with banks acquiring 24%, the ministry added.
According to caretaker finance minister Rossitza Velkova, Bulgaria achieved the highest investor demand for a single tranche on foreign capital markets, with an oversubscription rate of 4.4 times. This was also the biggest reduction in the initially-determined sovereign debt spread among countries from Central and Eastern Europe (CEE) in 2023 so far, starting from an average swap of 250 basis points and brought down to 215 bps, she added.
Bulgaria will decide on a subsequent government paper sale on international markets once a new budget for 2023 is adopted by parliament, Velkova said.
As recently as September 2022, Bulgaria raised 2.25 billion euro in a dual-tranche Eurobond issue.
Fitch currently rates Bulgaria BBB with a positive outlook, while S&P Global gives it a BBB/A-2 rating with a stable outlook.
($ = 0.9265 euro)