Albania places €450mn 5-year Eurobond

By bne IntelliNews November 7, 2015

Albania has successfully placed a five-year sovereign Eurobond worth €450mn, with interest rate of 5.75%.

The issue came after the finance ministry on November 4 repaid Albania’s previous €300mn five-year Eurobond. The new euro-denominated bond is intended for the repayment of the country’s public debt. The new issue was initially planned for June, but the Greek crisis delayed the plans.

The reoffering yield of the new Eurobond, which will mature on November 12, 2020, is 5.875%, business news provider Monitor said on November 6.

Deutsche Bank and JP Morgan Chase were hired to manage the new sovereign Eurobond issue. Investor meetings were launched at the end of September.

Albania sold its first Eurobond in October 2010, raising €300mn to finance the budget gap, with an annual interest rate of 7.5%.

The old Eurobond was initially intended to be repaid with a new issue, but then the plans were changed and the ministry used a €250mn loan from Deutsche Bank, guaranteed by the World Bank, to refinance the old debt. A total of €50mn was secured from instruments on the domestic market. The last instalment of interest was €22.5mn.

Albania’s gross external debt totalled €7.26bn at the end of Q2, up by 9.1% y/y, of which general government debt accounted for €2.8bn (+17.8% y/y).

Albania is ranked at 'B/B' by Standard & Poor's Ratings Services (S&P).

In the Southeast Europe region, Macedonia is also planning a new Eurobond issue.


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