$3 billion bonds issued
to repay maturing debts
The Ministry of Finance (MoF) issued U.S. dollar denominated bonds worth $3 billion to repay foreign currency debt maturing throughout the year. The original objective was to raise $1.5 billion.
The bonds were divided into three tranches with maturities set at ten, 15, and 20 years
The issue was managed by four banks: Barclays, Byblos Bank, Societe Generale de Banque au Liban (SGBL), and JPMorgan.
Subscription bids from local and foreign banks and financial institutions have generated a total order book of $17.8 billion, almost six times the value of the bond issue, according to Finance Minister Ali Hassan Khalil.
Foreign banks and financial institutions have subscribed to nearly $600 million or 20 percent of the issue.
“This reflects an unwavering confidence and interest in Lebanese bonds at a global level,” Khalil said.
The value of the bond issue is within the $3 billion ceiling granted by law.
He said: “The yields on the new bonds are good compared with those prevalent in secondary markets.”
The bonds have been issued in the following three tranches:
|Value||$1.25 billion||$1 billion||$750 million|
|Maturity||March 2027||March 2032||March 2037|
|Yield||6.85 percent||Seven percent||7.25 percent|
The country’s widening public debt is currently around $75 billion or about 150 percent of GDP. It has been growing over the years to finance a chronic fiscal deficit which reached $4.94 billion in 2016.
Reported by Shikrallah Nakhoul
Date Posted: Mar 22, 2017