Romania on Wednesday launched a bond issue on international markets for the first time this year to capitalize on improving perceptions after the government in Bucharest adopted reforms needed to reduce its budget deficit, Bloomberg reports. Interest rates at which Romania borrows fell to 6.34% for 10-year bonds after the Bolojan government's reforms.
According to a source close to the case, who wished to remain anonymous, Romania is offering euro-denominated bonds maturing in 2033 and 2044, as well as dollar-denominated bonds maturing in 2036, according to Agerpres.
Seven-year euro bonds are quoted at 250 basis points above the mid-swap rate and 10-year euro bonds are quoted at 325 basis points above the mid-swap rate. Dollar bonds maturing in 2036 are also quoted at 210 basis points above US Treasury bonds of the same maturity.
The annual financing plan envisaged for this year is about 265-275 billion lei, which would cover a budget deficit between 6% and 6.4% of GDP and refinancing of maturing public debt, while in terms of financing sources, it is estimated to contract public debt on the domestic market of about 160-170 billion lei and on the foreign market of about 21 billion euro, a draft Government Decision published at the end of January this year shows.
According to the Ministry of Finance, the initiator of the document, the estimated volume on the external market is to be provided by Eurobond issues in the amount of EUR 10 billion, the rest being estimated to be attracted through loans under the PNRR, SAFE programs, loans from international financial institutions and private placements. At the same time, Eurobonds worth around €3.25 billion will mature during 2026, namely €750 million on February 26, €1.56 billion on September 27 and €940 million on December 8, 2026.