Croatia sold on March 4 €1.5bn worth of 10-year Eurobonds, Banka.hr reported. The bonds were sold at 260 basis points above mid-swap, compared to about 287.5 basis points initially targeted.

The issue yielded 3.3%, almost one percentage point lower than in May last year when the country sold €1.25bn in eight-year Eurobonds. Demand for the issue reached €6.5bn, according to Reuters.

“The 3.3% yield will lower the pressure on the current account deficit and on the public debt therefore it can be seen as a kind of saving. At the same time, this price can be serviced by the state, considering the expected GDP growth,” Hrvoje Stojic, head of Economic Research Department at Hypo Alpe Adria Bank said.

He added that Croatia chose a good time to issue the debt thanks to the European Central Bank’s quantitative easing programme and the calming situation around Greece which lead to record yields achieved by countries around the Eurozone.

The high demand came as a result of the fact that no other issue was offered on the European bond market at the same time, he added.

According to previous reports, Croatia initially planned to raise up to €1bn under the debt auction. Barclays, Erste Group, JP Morgan and UniCredit managed the Eurobond issue.

Croat Finance Minister Boris Lalovac told Bloomberg in January the exact amount and the maturity of the bonds will depend on investors’ interest. The finance ministry expected a yield below 4%.

Croatia is rated BB by Fitch, Ba1 by Moody's and BB by Standard & Poor's.