Cyprus bond issue is met with strong demand (Stockwatch, Financial Mirror) 28.5.09

The Cyprus government issuance of four-year bonds, planned to refinance expiring public debt, was met with high demand at the end of May. The issue was oversubscribed by foreign investors, from Germany, Britain, France, and largely the US, by 5.5 times:  €5.5 billion in bids were received for the intended €1 billion issue. The government increased its issuance to €1.5 billion at an interest rate of 3.85%, lower than the 5% originally budgeted, though held back from selling more bonds in order to prevent public debt burden from growing; €1.25 billion of the issue went to foreign institutional investors, including central banks, commercial banks, and insurance companies, and €250 million to local investors. Cyprus Finance Minister Charilaos Stavrakis said that the results of the sale, which was the probably the largest oversubscription of European bonds this year, was a vote of confidence by foreign investors for the Cypriot economy and the government’s economic policy.