Greece launches exit to international capital markets

19:27 9/4/2014 - Πηγή: E-Typos

The Hellenic Republic announced it has mandated international banks for an upcoming five-year bond issue denominated in euros and under UK law.
The transaction will be priced and take place in the immediate future, the Finance

Ministry said in a statement.
According to sources, the issue is expected to be concluded on Thursday, while it is estimated the country will issue five-year bonds amounting to 2.5 billion euros.
The process will be launched officially on Thursday when JP Morgan and Deutsche Bank –the underwriters of the issue- will launch a book building process. Duration of the process will depend on investors’s interest. In case of increased interest and a significant oversubscription of the issue, the book building process will close within the day to be followed by the final results of the auction. The whole process is competitive which means that priority will be given to bids with lower interest rates. The target is to achieve the lowest possible interest rate. In case of oversubscription with a favorable interest rate, the Greek state could raise more than 2.0 billion euros, up to 3.0 billion euros. Market analysts said they expect the interest rate of the five-year bond to be around 5-5.25 pct.
Greece’s return to international markets was methodically prepared in a time when investors’ sentiment for Greek bonds and shares was very positive in international markets. The yield of the 10-year benchmark bond in the electronic secondary bond market fell to 6.1 pct, the lowest level in the last four years. Institutional investors’ interest for Greek securities was confirmed during a successful completion of share capital increase plans by Piraeus Bank and Alpha Bank. Greece successfully sold six-month Treasury bills on Tuesday, raising 1.3 billion euros from the market with the interest rate falling to 3.01 pct –the lowest since 2009.