New euro bond issue to help save EUR 250M in 10 yrs, PM says

Photo /Vijesti/2018/06 lipanj/7 lipnja/pvrh 2.jpg

Prime Minister Andrej Plenkovic said on Thursday the recent successful euro bond issue was another indicator of investors' trust in Croatia and that the issue would help to save EUR 250 million in ten years.

The Finance Ministry issued the EUR 750 million bond on the international capital market yesterday. It is due in 2028, the coupon rate is 2.7 and the yield 2.89%.

"It's a very good transaction refinancing the existing liability due in July. With this arrangement, seeing how much more favourable both the interest and the yield are, Croatia will save HRK 180 million annually. That's EUR 250 million in ten years," Plenkovic said at the start of a cabinet meeting.

He said investor interest in the issue was big. "That's another good indicator of the trust in Croatia, in the effort we have made in over two years to achieve fiscal consolidation, and of the fact that the positive results we have lead to such lowered interest rates."

He said the rates would be even lower if Croatia were in the euro area. "To those in a dilemma as to whether one should be in the euro area or not, I think it's the best indicator of what we should do and which road we should take, as soon as possible."

"I believe all these positive aspects on the macroeconomic front and trends will eventually lead to an upgrade of our credit rating, to what we want, Croatia's investment credit rating," Plenkovic said.

The world's three leading rating agencies have recently been upgrading Croatia's outlook and rating, S&P and Fitch to one and Moody's to two notches below investment level. All three consider the outlook stable.

Text: Hina

News | Plenkovic Andrej