January 19 (SeeNews) - Slovenia stays in a good shape to meet its funding needs on the bond market despite the monetary uncertainty, as foreign investors maintain their dominant role in the country's debt structure profile, Erste Group said.
"We see the finance ministry maintaining smooth roll-over on the T-bill market, while aiming to utilise the best conditions for additional bond issuance. Recent announcements from the finance ministry suggest that issuance outside Europe is likely," Erste Group said in a Central and Eastern Europe (CEE) bond markets survey published on Wednesday.
Yields will be likely shaped by global factors, namely risk appetite and benchmark moves, Erste noted.
The European Central Bank (ECB) will still play a pivotal role as far as refinancing operations are concerned, while the scope of the announced quantitative tightening operations should have a limited impact on Slovenia in the near term. On the local side, banks are following a similar trend of somewhat decreasing demand, with current exposure on their books standing at 2.1 billion euro ($2.3 million), or 6% of overall public debt as of the third quarter of 2022, Erste said.
Slovenia kicked off 2023 by issuing its second ten-year sustainable bond in the amount of 1.25 billion euro, while also tapping an existing 2045 tenor by an additional 250 million amid a strong investor interest, with book size close to 11 billion euro for both placements.
($ = 0.92484 euro)