Bosnias Federation sells 5-yr bonds worth EUR 8.8mn.

By bne IntelliNews June 27, 2012
Bosnias Federation sold BAM 17.2mn (EUR 8.8mn) worth of five-year bonds on the Sarajevo Stock Exchange on Tuesday, June 26, after offering for sale a total of BAM 30mn, the bourse said on its website. The Federation sold 17,165 bonds at an average yield of 6.1%, equal to 99.8199% of par. Demand totalled nearly BAM 23.4mn. The bonds mature on June 27, 2017. This was the Federations second bond issue. In May, it placed a BAM 80mn issue of three-year bonds on the Sarajevo bourse, selling 80,000 at an average yield of 5.26%, equal to 99.9799% of par. Demand totalled nearly BAM 109mn. Apart from this, the Federation has borrowed funds only via Treasury bills. Earlier this year, the Federations government said it has decided to issue three-year bonds worth a nominal BAM 130mn (EUR 66.5mn) to finance its 2012 budget spending. In addition to this type of borrowing, the Federations 2012 budget envisages issuing up to BAM 60mn of T-bills. The finance ministry has already placed three T-bills issues totalling nearly BAM 55mn so far this year at declining yields. The Federation as well as Bosnias other autonomous part - the Serb Republic, started selling short-term debt on the local stock exchanges in an attempt to finance their current budget expenditure. Bosnias access to cheap foreign financing has been stalled since the autumn of 2010 because the country failed to cut its public spending and meet the requirements on its IMF bail-out deal. Moodys downgraded the countys credit rating in April over deteriorating public-sector budget and limited access to external financing.

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