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UPDATE 1 - Croatia places bonds worth 11 bln kuna (1.5 bln euro) on domestic market

Author Iskra Pavlova
UPDATE 1 - Croatia places bonds worth 11 bln kuna (1.5 bln euro) on domestic market Photo: Croatian government

ZAGREB (Croatia), November 22 (SeeNews) - Croatia sold bonds worth 11 billion kuna ($1.6 billion/1.5 billion euro) on the domestic market, raising funding to refinance debt maturing on November 29, prime minister Andrej Plenkovic said on Friday.

"The finance ministry succeeded in refinancing this bond at the most favourable borrowing terms in history," Plenkovic said at the opening of the regular weekly cabinet meeting, which is streamed online on the government's website.

Two bond issues were placed, one worth 3.5 billion kuna and maturing in 2024 , and another worth 7.5 billion kuna and maturing in 2034, Plenkovic also said.

He commented that thanks to the new borrowing 340 million kuna will be saved in interest payments annually.

The finance ministry said in a statement later on Friday that the 3.5 billion kuna bond was sold with a 0.25% interest rate, yielding 0.36%, while the 7.5 billion kuna bond (which is indexed to the euro) has a 1.00% interest rate, yielding 1.20%.

Most of the proceeds will go to refinance the 1.0 billion euro ($1.1 billion) bond maturing on November 29, while the remainder will go to meet state budget needs, the ministry said.

It added that interested investors placed bids worth more than 23 billion kuna for the two new issues, with over 10 billion kuna offered for the five-year securities and more than 13 billion kuna for the 15-year bond.

The issue arrangers included Erste, Privredna Banka, Raiffeisenbank and Zagrebacka Banka.

(1 euro = 7.43758 kuna)