Slovenia aims to head off bailout worries with early debt rollover

By bne IntelliNews April 12, 2013

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Slovenia, pegged as the next in line to require a Eurozone bailout following Cyprus, announced plans on April 11 for the early rollover of debt maturing in June - a move intended to calm markets and thwart a squeeze on its finances.

Slovenia's Finance Ministry announced it will look to auction around €500m worth of 18-month treasury bills on April 17 in order to power the refinancing of the debt. At the same time, it said it would offer to buy back €855m in June 6 bills at 99.525% of their face value.

According to Reuters, the government needs about €3bn this year to recapitalise state-owned banks, repay maturing debt and cover the budget deficit. However, yields on Slovenia's 10-year benchmark bond rose to 6.48% on April 11 - just below the 7% threshold at which a country's finances are seen as unsustainable - from 4.77% on March 15, the day before the Cyprus bailout deal.

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