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Investor Meetings Begin for Potential Dollar Bond Issue

San Francisco, 15 October (STA) - Three selected banks will launch an investor roadshow on Slovenia's behalf on the US West Coast on Monday as the country plans to issue a new US$1.5bn bond issue this year.

Arranged by BNP Paribas, Deutsche Bank and JP Morgan, the investor meetings will move from the West Coast to be held in Boston on Tuesday, New York on Wednesday, and London on Thursday and Friday.

Finance Minister Janez Šušteršič expects the planned dollar issue to be successful. The transaction will depend on the market situation, which analysts deem fairly favourable for bond issues at the moment.

Potential investors in the US markets are mainly considered to be bond funds, which have good liquidity this year, analyst Andraž Grahek has recently told business daily Finance.

Economist Velimir Bole agrees that the dollar market is auspicious, but also believes that it would make sense for Slovenia to try other markets too and other instruments as the country has enough assets to do so.

"If the state manages to cover liquidity needs by the end of 2013, this will certainly be the biggest contribution to a stabilisation of the ratings," Bole told the parliamentary Public Finance Oversight Commission on Friday.

If the dollar bond issue should fail, economist Mojmir Mrak expects "access to the funds from partners in the EU - I'm not going to call it aid - is likely in a very short period of time". If the issue is successful, he believes it will buy the country a few more months that open the window of opportunity to avoid this.

Minister Šušteršič says the government has a backup plan. "We will look for the best alternative in the event of complications. We will have a backup plan, but I'm convinced that we won't need to use it," he said in September.

During his recent visit to Tokyo, where he attended the International Monetary Fund and the World Bank meetings, Šušteršič held bilateral meetings with representatives of investment banks interested in the Slovenian bond.

He also held meetings to learn about other countries' experience in issuing bonds in Asian markets. "This is one of the possibilities we will carry out, but definitely not this year," he told the STA.

Slovenia did not issue bonds this year, but relied on borrowing through short-term securities so that its debt increased by EUR 815m. Under the amended budget financing plan for this year, the country can borrow up to EUR 4.53bn.

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