Serbia sells 54% of EUR 90mn T-notes issue with floating interest rate.

By bne IntelliNews February 6, 2013
Serbia sold RSD 5.4n (EUR 48.5mn) worth of two-year Treasury notes, or 54% of the total on offer, on Tuesday, Feb 5, the finance ministry's Treasury department said on its website. Demand totalled RSD 9.15bn, or 91.45% of the offering. The Treasury sold a total of 540,000 T-notes at a variable coupon, equal to the central bank's reference interest rate (11.5% at present) plus 0.98% annually. The newly sold securities mature on February 7, 2015. Previously, Serbia issued only once two-year T-notes with a floating coupon rate in August 2012 - in an attempt to offer investors a better protection from rising inflation. In the first auction, the Treasury sold RSD 6.8bn, or 66.8% of the amount on offer. These securities had a variable coupon, equal to the central bank's reference interest rate (10.25% in August 2012) plus 4%. Serbia's CPI inflation reached 12.2% y/y at end-2012, up from 7.9% in August - while the NBS increased its key repo rate by 100 basis points over the same period. Serbia plans to sell dinar-denominated debt paper worth a nominal RSD 46bn (EUR 413.5mn) and euro-denominated securities worth EUR 50mn in February 2013. In January 2013, the Treasury sold RSD 27.6bn of dinar-denominated debt papers, or 78.9% of the amount on offer (RSD 35bn), and EUR 30mn of euro-denominated securities (100% of the target).
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