Cyprus raises €1 bln through bonds issue

Cyprus raised €1 bln in a double -European bond issue through the reopening of existing bonds maturing on 3 December 2024 and 21 January 2040, with the total demand exceeding 10 times the minimum amount set.

The minimum amount for each bond transaction was €250 mln.

In a written statement, Finance Minister Constantinos Petrides expressed his satisfaction with “the extremely positive response by the markets.”

He said the demand for the bond maturing in 2024 exceeded €2 bln, while for the bond maturing in 2040 demand was higher at €3 bln.

As for the interest rates, at this stage, it appears it will be around 0.34% for the five-year period and 1.47% for the 20-year issue.

The books have been closed and the processing of the results is currently in progress.

“Based on the above data, the Republic of Cyprus has decided to absorb a total of €1 bln,” said Petrides.

According to Petrides, the total offer has surpassed €5 bln, 10 times the amount initially announced, a fact that demonstrates the confidence of the international markets to the Cypriot economy.

“Increasing the state`s liquidity creates more options for possible repayment of more expensive or short-term debt in the near future, reducing both the cost and the risks of public debt.”

Petrides said the public debt will only increase temporarily, as the funds collected will soon be used exclusively to repay the existing debt.

Nicosia went ahead with the issues to replace more expensive debt for cheaper debt.