Romania gets eurobonds sale back on track

Romania has revived its planned sale of eurobonds, postponed in November when the government collapsed, and said it may return for additional borrowing later this year. The country is likely to sell about EUR 1 billion of bonds denominated in the European currency and may sell more securities before year-end.

Deutsche Bank AG, EFG Eurobank and HSBC Holdings are arranging investor meetings starting March 8, according to the Finance Ministry. Romania is seeking to take advantage of improved investor confidence as central authorities plan to narrow the 2010 budget deficit to 5.9 percent of gross domestic product from 7.2 percent last year.

The International Monetary Fund, which suspended a EUR 20 billion bailout package as the government collapsed amid infighting, resumed payments last month, releasing the equivalent of EUR 2.4 billion.

Bondholders returning to Romania have driven down the extra yield on government notes due in 2018 to 278 basis points above similar-maturity German bonds, from as high as 374 basis points in December and 959 basis points at the beginning of 2009.

Fitch Ratings raised its outlook on Romania’s BB+ credit ranking to stable from negative at the beginning of last month.

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Staff