site.btaFinance Ministry Reopens 10.5-Year Government Bonds Issue

Sofia, July 18 (BTA) - The Finance Ministry has reopened an issue of 10.5-year lev-denominated government securities maturing July 25, 2027, the Ministry said on Tuesday.

Government securities worth 89.5 million leva were placed at an auction held on July 17, at a weighted average yield of 1.63 per cent. The subscribed amount totalled 201.8 million leva, the bid-to-cover ratio being 2.02. The spread to the ten-year German Bunds in this maturity segment is 103 basis points.

After the auction, the volume of this 10.5-year government bonds issue totals 339.5 million leva. This is within the limits on government securities issuance on the domestic market laid down in the 2017 National Budget Act.

The issue is a reference one in 2017 with respect to the harmonised long-term interest rate to evaluate convergence level, which is one of the Maastricht criteria.

Pension and guarantee funds acquired 58.1 per cent of the bonds at the auction, followed by insurance and life insurance companies with 41.34 per cent, and banks with 0.56 per cent.