Govt secures new bond for less
18:15 Wed Sep 23, 2015
Attorney General Aiyaz Sayed-Khaiyum says the governmentthey have secured the new bond at a rate of 6.625% and this is less than the previous 9% bond.
Taken from/By: FBC NEWS
Report by: Shanal Sivan
The Government has secured a new sovereign bond from a US insurer to pay off a previous bond which matures next year.
The Attorney General and the Minister of Finance, Aiyaz Sayed-Khaiyum told Parliament today they have secured the new bond at a rate of 6.625% and this is less than the previous 9% bond.
Fiji has also bought the existing bond at the new rate meaning Fiji will save about $9 million.
He said the previous 9% bond was due to the turbulent and volatile market conditions and global financial crisis.
Instead of buying the new bond in March the government has bought it now.
“We could not alert the market otherwise we would have been subject market speculation and therefore higher pricing and we would have been a price taker if we went to the market late. This outstanding tender results of 97.25% success rate is one of the highest success rates achieved for sovereign bond in the past few years for similar tender offers of buy back in the market.”
Sayed-Khaiyum says with the new interest rate Fiji’s debt level falls by
$ 93 m.
Fiji will now raise USD $200 million instead of USD $250m.
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