Romania: Finance ministry taps foreign markets with two USD-denominated issues
Metodi Tzanov
Helping finance professionals understand what is going on in Emerging and Frontier Markets
The finance ministry is tapping international markets with two USD-denominated, according to the business daily Ziarul Financiar, which quotes Bloomberg. One is a 2029 bond with an indicative rate at 225bps above a US T-bill with similar maturity, the second is a 2034 one with an indicative rate at 265bps above the US T-bill yield. The previous USD-denominated issues on foreign markets were in January 2023, when the finance ministry raised USD 3.75bn with three maturities. The finance ministry raised back then USD 1bn with a 5-year bond at 280bps above the US T-bill, USD 1.5bn with a 10-year bond at 350bps above similar T-bill and USD 1.25bn with a 30-year one at 385bps above similar T-bill.
The finance ministry raised EUR 5bn and USD 3.75bn by selling bonds on external markets in 2023, slightly above target. As for this year, the authority targets EUR 12-13bn, including EUR 8.5-9.5bn foreign currency bonds, EUR 2bn RRF loans and EUR 1.5bn from IFIs. Gross financing needs were estimated at RON 181bn, by 10.8% lower than in 2023, of which RON 86.6bn is the budget deficit and RON 94.4bn - maturing debt.
The government recently approved the finance ministry's proposal to increase the MTN programme ceiling by EUR 6bn to EUR 68bn. Net borrowing in the MTN programme is at EUR 59.4bn, which enabled EUR 2.6bn further borrowing, so the ceiling had to be lifted because the finance ministry plans to borrow more.