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Slovenia Borrows US$3.5BN Via Dual-Tranche Bond

Ljubljana, 11 February (STA) - Slovenia has raised US$3.5bn through a two-part US dollar bond issue. It issued a US$1.5bn five-year bond with the yield of 4.275% and a US$2bn ten-year tranche with the yield of 5.48%, the Finance Ministry announced on Tuesday.

Slovenia opened books on the dual-tranche issue on Monday, with the ministry saying that the transaction invited an immediate interest, also from European investors.

The orders totalled US$16.4bn in what the ministry says is the biggest order book for a syndicated sovereign bond issue in the region of Central and Eastern Europe, the Middle East and Africa this year.

The demand was high even though Slovenia substantially reduced the spread to the corresponding benchmark US sovereign bond during the transaction. The initial guidance was between 3.000 and 3.125 percentage points.

Within a few hours after the books' opening, orders topped US$12bn, which enabled the sovereign to reduce the guidance on both tranches to 2.875 percentage points.

As investors' interest continued even after the start of morning trading in the US, the final price was set at 2.800 pp above the yield on the US bond for both tranches, according to the Finance Ministry.

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