The Republic of Serbia priced a dual tranche Thursday in the international financial market, issuing two dollar-denominated eurobonds, with the maturity of 5 and 10 years in the total amount of USD 1.75bn (USD 750m and USD 1,000m, respectively), NBS said in the statement.
The demand for both eurobonds exceeded USD 11bn during the day, showing that international investors have confidence in the long-term sound and sustainable economic indicators of our country, the central bank added.
The 5-year bond was issued at a coupon rate of 6.25% and the 10-year at a coupon rate of 6.50%.
The Republic of Serbia also concluded hedging transactions, converting liabilities under dollar-denominated eurobonds into euros, in order to reduce both the currency and interest rate risk, NBS announced.
By doing so, the Republic of Serbia has reduced exposure to the USD/EUR exchange rate risk, but also the country’s de facto cost of borrowing so that after the hedging it equals 6M EURIBOR plus 2.9 pp for the 5-year bond and 6M EURIBOR plus 3.1 pp for the 10-year bond.
Source: NBS, Momentum
