site.btaFour Banks to Manage Bulgarian Bond Issues over Next Three Years

Four Banks to Manage Bulgarian Bond Issues over Next Three Years

Sofia, February 10 (BTA) - Bulgaria has chosen four banks as
agents for a mid-term bond programme worth 8 billion euro over
the next three years, according to a bill introduced in
Parliament and published on its website.

The bill drafted by the Council of Ministers envisages
ratification of a Dealer Agreement between Bulgaria on the one
hand, and Citigroup Global Markets Limited, HSBC Bank Plc,
Societe Generale and UniCredit Bank AG on the other hand,
regarding Bulgaria's global medium-term note (GMTN) programme
worth 8 billion euro. The Agreement was signed on February 6.

Later on an Agency Agreement and a Deed of Covenant are to be
submitted to and ratified by the National Assembly.

The purpose of the signed agreements is to launch a GMTN
programme for bond issues in the international markets. The
total volume for each year will be specified in the National
Budget Act. The maximum maturity of the bonds is up to 30 years,
 and the maximum interest rate is up to 10 per cent. This
considerably exceeds the current interest on Bulgarian bonds so
as not to send signals to the market about the interest rates on
 the new bonds. The fixed values of the parameters of the GMTN
programme can be changed solely by Parliament.

The GMTN programme provides Bulgaria, as an issuer, with an
opportunity to apply a flexible approach in the selection of
debt markets, instruments, maturity and currencies. The funds
received in the implementation of the GMTN programme will be of
considerable importance for ensuring the required financial
resources in the period 2015-2017 for refinancing of government
debt, for covering the expected budget deficits and for ensuring
 the fiscal reserve, the sponsors of the bill reasoned.