Slovenia issues $500M in 10-year US dollar bonds
The Republic of Slovenia, rated A2 (stable) / AA (stable) / A+ (stable), entered the markets with a US$ 500mn 10-year 144A / Reg S bond. The US$ is a strategic currency for the Republic.
This transaction marks the second return to the US$ market of Slovenia since 2014, CE Report informs via the Ministry of Finance of Slovenia's official website.
With a solid demand of over US$ 785mn (including JLMs interest), Slovenia could once again count on its diversified institutional investor base. Barclays, Deutsche Bank, DZ BANK, J.P. Morgan and Raiffeisen Bank International jointly led the offering.
The new US$ 500mn 10-year offering priced with a coupon of 5.600% and a reoffer spread of CT10+65bps, representing a 5.630 percent reoffer yield and reoffer price of 99.773 percent.
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With this transaction, Slovenia extends its US$ curve, following up on its last 10-year US$-benchmark outing back in 2023. With this transaction, the Republic continues to represent the CEE region in US$ capital markets.
For the purpose of hedging against the movement of the exchange rate of the US dollar against the euro, a currency swap was implemented in the entire value of the issue. The actual cost of financing the state budget by issuing a dollar bond after currency exchange is 4.124 percent.
With this US$ 500 mn bond issuance, the Republic of Slovenia continues its periodic presence in the US dollar capital market, which forms a part of its long-term funding strategy. The issuance supports the diversification of funding sources and the maintenance of relationships with international institutional investors. The size of the issuance is consistent to further reduce the debt-to-GDP ratio, which is projected to reach 64.6 percent in 2026.
Geographical distribution
- 65 percent Continental Europe
- 15 percent Asia / Middle East
- 12 percent UK
- 8 percent North America
Institutional investor distribution is follows:
- 32 percent Asset Manager
- 32 percent Banks / Private Banks
- 27 percent Central Banks/ Official Institutions
- 6 percent Insurance / Pension Fund
- 3 percent Hedge Fund
