You are here

“Definite return” to markets in late 2015

20/08/2015 09:52
The government aims to restore the long-term sovereign rating of Cyprus by issuing debt at the end of 2015, Finance Minister Haris Georgiades told StockWatch.

He noted that “the plan for new debt issuance by the end of 2015, around the beginning of December, is one of the main objectives of the economic policy for the current year”.

“The new scheduled return of the country to the markets aims at the definite and permanent restoration of the state’s creditworthiness”, he added.

The debt issuance, he said, will be done depending on the prevailing market conditions.

The latest debt issuance was held in April with seven-year bonds with an average accepted interest rate of 4%, the yield of which is currently 3.61%. With the issue Cyprus raised €1 bn.

The drop in the yields on Cypriot bonds is linked to the positive performance of the Cypriot program and the quantitative easing program under which the ECB may purchase Cypriot bonds.

The yield on the ten-year Cypriot bond maturing in 2020, yesterday stood at 3.3%, near its lowest level.

The finance minister did not specify details of the forthcoming debt issuance since, as explained, the relevant study of the public debt management office is underway.

Mr. Georgiades pointed out that the markets continue to confirm the correction path of the economy and this, as noted, is reflected in the yields of Cypriot bonds.

The updated memorandum is expected to be prepared and sent to the parliamentary parties early September, based on the recent review of the economic program of Cyprus.

According to the finance minister, the updated memorandum will simultaneously be sent to the eurozone member states and the Euro Working Group, which is expected to convene in early September in order to prepare the final report on Cyprus, which will be forwarded to the regular Eurogroup meeting.