Finance Minister Constantinos Petrides said on Tuesday he was satisfied with the double bond issuance which will meet Cyprus’ borrowing needs and repay an International Monetary Fund (IMF) rescue loan.
Petrides said the bonds would meet the country’s borrowing needs for 2020 and repay the IMF rescue loan earlier than expected.
The 10-year and 20-year euro denominated bonds, of €1 billion and €750 million respectively, have low interest rates. Their indicative yields so far stand at 0.73 per cent for the 10-year bond and at 1.33 per cent for the 20-year bond.
Total bid value exceeded €13 billion, comprising the largest bid in the history of this type of bond issue, and exceeded the original request by almost seven times, Petrides said.
He added that the bond will be used to repay the IMF loan earlier, “proving that Cyprus is able to cover its own financing needs from the markets.”
With the repayment, Cyprus will save more than €15 million in interest rates, he said.
Repaying the IMF loan is also expected to impact positively on capital markets, enhancing the credibility of the Republic of Cyprus towards investors, according to the minister.
He said the goal is to secure stability and growth.