Connect to share and comment

Slovenia raises 1.1 billion euros in treasury bills

PlacardEnlarge
(Globalpost/GlobalPost)

Slovenia raised 1.1 billion euros ($1.4 billion), over twice what was expected, at a treasury bill auction on Wednesday, despite speculation the eurozone country could be the next in line for bailout.

The country sold the 18-month treasury bills at an average interest rate of 4.15 percent, 0.16 percentage points higher than at the last auction of 18-month bills in December 2011, the finance ministry said in a statement.

The ministry had initially expected to raise only about 500 million euros to refinance a previous emission of treasury bills that will come due in June.

In comparison, Slovenia raised 56.1 million euros instead of the expected 100 million euros at an auction of six- and 12-month treasury bills last week. The bills were also sold at considerably higher rates than planned.

Part of the money raised on Wednesday was immediately used for the early buy-back of 510.7 million euros worth of 18-month treasury bills due to expire on June 6, the ministry said.

The bills -- part of a 855-million-euro emission -- were bought back at 99.525 percent of the nominal price, the ministry said.

Slovenian state radio reported most of the T-bills sold Wednesday were bought by domestic banks while over 250 million euros worth were acquired by foreign investors.

A severe recession and a mountain of bad debts at its banks have raised concerns that Slovenia, once a model newcomer to the European Union, may be the next eurozone member after Cyprus to need a bailout.

In early trading on the secondary market on Wednesday, the yield on Slovenia's 10-year bonds reached 6.99 percent, close to the 7.0-percent danger mark seen as pushing slow-growth countries towards a bailout.

The yield later fell to 6.23 percent, however, the Slovenian news agency STA reported.

bk/ssw/rl

http://www.globalpost.com/dispatch/news/afp/130417/slovenia-raises-11-billion-euros-treasury-bills-0