Insider Economy Fund managers take the lion’s share in 15-year bond issuance

Fund managers take the lion’s share in 15-year bond issuance

Fund Managers took the lion’s share in the issuance of the first ever 15-year bond by Cyprus, with 55% of the allocations, followed by banks (20%) and insurance and pension funds (10%), the Ministry of Finance said on Wednesday.

According to the Ministry, the transaction saw a strong and diversified international participation, with domestic investors accounting for only 9% of the final allocations and 27% of the bonds placed in Germany, Switzerland and Austria.

“The Republic of Cyprus, rated BBB- (stable) by Standard and Poor`s, Ba2 (stable) by Moody`s, BBB-(stable) by Fitch and BBBL (stable) by DBRS, successfully launched its first syndicated transaction of the year, pricing a new EUR 1bn 15-year Reg S registered benchmark due 26 February 2034” said the Ministry of Finance.

The bond carries a coupon of 2.75% and was priced at 99.903%, it added. Citi, Goldman Sachs International and HSBC were mandated as joint bookrunners on the transaction.

“The objectives of the transaction were in line with the stated Public Debt Management Strategy of the Republic of Cyprus to continue building out an international bond yield curve, manage refinancing risk by smoothening out and lengthening the debt maturity profile, enhance investor relations and expand the existing investor base” the Ministry noted.

It said that the launch of the transaction followed the successful funding exercises completed over the course of 2017 by the Republic of Cyprus and its continued market access last year.

According to the Ministry, prior to the launch of the transaction, Cyprus had conducted extensive marketing efforts, targeting investors in London, Paris, Milan, Munich and Frankfurt. Based on positive feedback from these meetings, the issuer opted for the 15-year maturity and a target EUR 1 billion in size.

“Final demand of over EUR 8.1 billionn represents the largest orderbook achieved by a Republic of Cyprus benchmark transaction since the sovereign’s return to the international bond markets in June 2014” the announcement stressed.

“The deal was priced at 17:44 CET with a cash price of 99.903% and a re-offer yield of 2.758%, thereby offering a minimal new issue concession over the theoretical fair value of the transaction” it added.

“The success of this transaction highlights the strong support from the international investor base for the Republic of Cyprus” it noted.

Read more:

Top Stories

Large blast in Beirut port area shakes Cyprus

A large explosion shook the Lebanese capital Beirut and a giant column of smoke was seen rising over the city, Reuters witnesses and local...

Twenty-five new corona virus cases detected out of 3,988 tests

According to the Epidemiological Surveillance Unit of the Ministry of Health 25 new cases of the SARS-CoV-II virus were detected out of a total...

Mainly fine weather with new yellow alert for extremely high temperatures

Mainly fine weather on Wednesday with yet another yellow alert for extremely high temperatures issued – in effect from 1pm to 5pm. Temperatures are expected...

Industrial producer prices up by 0.7% in Euro area and 0.4% in Cyprus in June 2020

In June 2020, the fourth month during which Covid-19 containment measures are being applied in most Member States, industrial producer prices rose, compared with...

People needed to manage thermal cameras

The Ministry of Health announced a tender for the purchase of services by health professionals for the management of thermal cameras at Larnaca and...


Octopus ‘Kathisto’ (or Octopus braised in Wine)

Ingredients: 1/2 cup Greek extra virgin olive oil 2 medium onions, chopped fine 1 large octopus, about 2kg (cleaned and kept whole) 3/4 cup dry red wine 1/3 cup...

Homemade lemonade

Ingredients: 1 cup lemon juice 1 cup sugar Method: Thoroughly wash the lemons with soap and warm water. Roll each lemon with the palm of your hand, pressing...

‘Striftaria’ mini cheese pies

Ingredients 1 ½ cup milk 2 tbsps. flour 4 tsps. of butter 3 eggs, slightly beaten + 1 extra with 1 tbs. of milk for spreading 1 pack of...

Mini potato canapes baked on salt

Ingredients Serves: 12 1kg small Cypriot potatoes rock salt, as needed 250g salted butter 300ml full fat cremé frâiche 1 pot cod or salmon roe Method Prep:20min › Cook:35min › Ready in:55min Take...