Serbia might repay early debt to London Club of creditors.

By bne IntelliNews January 24, 2013
Serb finance minister Mladjan Dinkic announced plans for an early repayment of the country's debt to the London Club of creditors, aiming to save on payments of costly interest, news agency Tanjug reported. Serbia has to pay a 6.75% interest on the debt until 2024, Dinkic was quoted as telling weekly NIN. "This plan could be realised once we secure our financing needs for this year," he said, adding the government can borrow at much more favourable terms now and save on interest difference. Serbia's debt to the London Club totalled EUR 662mn at end-November, down 0.3% m/m and 5.4% lower y/y, according to latest available central bank data. Dinkic said the interest Serbia pays continues to be high but the government plans to lower it to below 5% already this spring at sale of the next Eurobond issue and to decrease it to 3-3.5% by the end of its four-year term in office, which expires in mid-2016. At its last Eurobond sale, Serbia placed five-year debt worth USD 750mn at an annual yield of 5.45% in mid-November and a 10-year Eurobond worth USD 1bn at a 6.625% interest at end-September.

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