Romania’s Ministry of Public Finance (MFP) borrowed on Monday RON 300 million from banks through a certificate issue of treasury for six months, at an average yield of 0.43 percent per year, the lowest obtained by the state for this kind of borrowings.
The issuing’s value was RON 300 million, but the banks have oversubscribed the offer over four times and transmitted offers valued at over RON 1.3 billion.
MFP planed borrowings amounting to RON 4.435 billion from commercial banks in August, out of which RON 4 billion through eight auctions of treasury certificates and state bonds and RON 435 million through supplementary sessions of uncompetitive offers, affiliated to the auctions and bonds.
The amounts are destined to public debt refinancing and state budget deficit financing.
According to the issuing forecasts, MFP will organize in August two auctions of treasury certificates with discount, valued at RON 1.1 billion, one on August 8, valued at RON 300 million and the other on August 25, valued at RON 800 million.
Moreover, six bonds auctions of benchmark type will be organized, valued at RON 2.9 billion, each being followed the second day by a supplementary session of uncompetitive offers, valued at 15 percent of the initial value of the bonds issuing.
The total volume of borrowings that will be launched by the MFP on the internal market through state bonds issuing is determined by the level forecasted by the budgetary deficit of 2.8 percent from GDP (around RON 21 billion), that will be refinanced 50 percent on the internal and 50 percent on the external market, as well as the state bonds refinancing denominated in RON and EUR, with maturity in 2016, valued at around RON 38 billion.
Moreover, the Finance Ministry is considering to attract new financial resources from the external markets in a volume of EUR 4.5 billion, based on the evolutions and the opportunities offered by these markets, taking into account the back payments level affiliated to the eurobonds issuing on the external markets with the maturity on June 2016, valued at EUR 1.5 billion.