Serbia plans to auction EUR 1.3bn worth of debt in Q1 2014.

By bne IntelliNews January 8, 2014

Serbia plans to borrow the equivalent of EUR 1.34bn on the domestic market in January-March 2014, which is roughly 23% more than the planned domestic debt issuance in the like period of 2013, the finance ministry's Treasury department said.

The ministry will issue EUR-denominated securities worth EUR 225mn in Q1, up from EUR 130mn planned in Q1 2013, and dinar-denominated debt worth RSD 129bn (EUR 1.12bn, up 17.3% y/y) in January-March.

The maturities will range from three months to seven years for the dinar debt and from two to five years for the euro debt.

In 2013, Serbia has issued the equivalent of EUR 3.8bn (11.6% of the full-year GDP forecast) of debt paper on the domestic market. Investor appetite for Serb government securities has weakened in mid-May, reflecting both internal (rising fiscal imbalances) and external (higher risk aversion of international investors) factors. It has improved slightly in the last quarter of the year, as in early October, the government announced a set of austerity measures aiming to curb rising budget gap in 2013.

The country also placed two Eurobond issues in February and November on the international financial market worth a combined USD 2.5bn (EUR 1.8bn).

In 2014, Serbia plans to borrow some EUR 5.6bn to service its debt and finance a budget gap that is expected to reach 7.1% of economic output, finance minister Lazar Krstic said in December. In net terms, the country’s public debt will increase by EUR 1.6bn in 2014, Krsic underscored.

Serbia's debt issues on the domestic market Planned amount Sold amount Realization rate*,%
  RSD bn EUR mn RSD bn EUR mn RSD bn  EUR mn
Q1 13 110.0 130.0 96.3 130.0 87.5 100.0
Q2 13 89.0 225.0 67.8 156.4 76.2 69.5
Q3 13 83.0 150.0 53.3 114.4 64.2 76.3
Q4 13 128.0 475.0 105.6 334.7 82.5 70.5
Q1 14 129.0 225.0 / / / /
Total 2013 410.0 980.0 323.0 735.5 78.8 75.1
Source: NBS, Public debt administration, IntelliNews calculations;* Ratio between sold and planned amounts.

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