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The Finance Ministry placed two bond issues on the international markets on Tuesday for a total volume of 2,500 million euros (almost 5,000 million leva), Capital reported. They have a maturity of 10 and 30 years.
The issue was expected in May but was postponed due to more unfavorable economic conditions during the pandemic and preparations for Bulgarian membership in the lobby of the Eurozone ERMII and the Banking Union.
Initially, the Finance Ministry planned to issue € 2 billion, but due to strong demand, it was decided to sell € 1.25 billion of each issue, Capital reported. So far, the Ministry of Finance has not provided any information on the debt.
The yield achieved is 0.40% for 10-year securities and 1.48% for 30-year securities, which is defined as very favorable levels.
The new debt is considered more of a cushion as, according to data from the end of July, Bulgaria has a fiscal reserve of more than BGN 10 billion. In addition, the European Commission approved a favorable loan of BGN 1 billion to the country under the new program for SECURE employment.
However, at the same time, the updated budget this year has a deficit of BGN 3.5 billion, which must be financed. However, at the end of August there was still a surplus of more than BGN 1.5 billion in the budget, entirely due to late spending.
According to the latest data, Bulgaria’s public debt amounts to BGN 24.5 billion, representing 20.7% of GDP with an acceptable limit according to the Maastricht criteria of 60%.
Bulgaria last entered international markets in 2016, when it also successfully sold € 2 billion.
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