Fitch Rates Romania’s 2020 Eurobond at BBB-

By bne IntelliNews September 18, 2013

International rating agency Fitch has assigned Romania’s EUR 1.5bn bond issued last week a BBB- rating in line with Romania’s long term IDR. The bond is due on September 18, 2020.

Romania has issued a EUR 1.5bn Eurobond with a maturity of seven years, yielding 4.769%, the country’s finance ministry said on Sep 12. The yield was set at 295bps above midswap – 75bps down from Romania’s latest euro-denominated Eurobond placed in October 2012, the ministry has said. The issue was abundantly oversubscribed. The bond has a coupon of 4.625%.

Fitch has confirmed the BBB-/stable rating for Romania’s long-term foreign currency Issuer Default Rating (IDR), on Sep 13. Fitch thus maintains the country at the lowest level above the speculative investment area, in line with S&P and one notch above the rating given by Moody’s.

An upgrade/downgrade of the sovereign is linked to the pace of structural reforms, including the sale or restructuring of key state owned enterprises. An upward risk to result in rating upgrade would stem from higher than expected reduction of the external debt ratios. Conversely, a fiscal loosening or tougher external turbulence could prompt a downgrade.

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