Friday, September 20 2019 12:59
Emmanuil Mkrtchyan

Applications for purchase of Armenian sovereign bonds in  international markets five times exceeded supply volume

Applications for purchase of Armenian sovereign bonds in  international markets five times exceeded supply volume

ArmInfo.The volume of  applications for the purchase of Armenian sovereign bonds in  international markets amounted to $ 2.5 billion. The organizer of the  issue opened a book of applications on the eve when it announced the  start of placement of 10-year Eurobonds in the amount of $ 500  million with an initial yield of 4.625% per annum.

Significant prevalence - by 5 times - of demand over supply led to a  decrease in the yield rate to 4.2% per annum, and the coupon rate  (Coupon Rate) was 3.95%.

Earlier, ArmInfo reported that the Government of Armenia on July 4  approved a draft decision "On Establishing the Specifics of  Organization of Procedures for Acquiring Services for the Issue,  Placement and Redemption of Eurobonds", thereby starting the  preparatory process for the placement of the third tranche of  Eurobonds and refinancing of debt on previously issued securities .

The third tranche of Armenian Eurobonds, released the day before, was  an expected event. Indeed, according to the schedule of repayment of  government debt, until 2054, the most peak in servicing the public  debt will be 2020 and 2025. In 2020, Armenia will have to "pay out"  about 417 billion drams or $ 857 million (the calculated exchange  rate of the Armenian dram to the dollar is $ 1 = 486.55 drams), and  in 2025, to repay the principal amount of all government debt formed  at the end of December 2018 The price of the issue will be about 406  billion drams ($ 834 million). In both cases, $ 500 million of this  amount are repayments on Eurobonds. It was on the basis of these  calculations that the experts predicted the issue before / or in 2020  - before the next payment of the debt on the first tranche, which is  scheduled for September 30, 2020. It should be noted that today  Armenia has carried out two issues of Eurobonds. The first issue was  carried out on September 19, 2013, Eurobonds worth $ 700 million were  issued with a maturity of 7 years, until September 30, 2020. The  yield on the placement was 6.25%. The government repaid ahead of  schedule a $ 500 million stabilization loan taken from Russia. The  main underwriters were Deutsche Bank AG, London Branch, HSBC Bank plc  and J.P. Morgan Securities plc. The average yield of these Armenian  sovereign securities is about 3.2%.

The second tranche of sovereign bonds in the amount of $ 500 million  for a period of 10 years and with a yield of 7.5% was implemented by  Armenia on March 19, 2015. Proceeds from the second issue of  Eurobonds amounted to $ 488 million. Part of the amount received from  the sale of these bonds in the amount of $ 200 million went to the  redemption of the first issue of bonds with maturity in 2020. The  remaining amount was transferred to the single treasury account of  Armenia and sent to the budget system of the country. The average  yield is currently estimated at 3.9%.

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Government Bonds

Issue volume

10 billion

Volume of T-bills for placement

200 million

Volume of submitted competitive applications

200 million

Volume of satisfied bids

200 million

Yield at cut-off price

 5.8314%

Maximum yield

 5.8314%

Мinimum yield

 5.8314%

Weighted average yield

 5.8314%

Number of participants

2

The maturity date of T-bills

03.02.2020

ArmEx

 

СПРОС (Покупка)

USD

Средневзв. Цена

482,00

ПРЕДЛОЖЕНИЕ (Продажа)

  USD

Средневзв. Цена

-

СДЕЛКИ

USD

Цена откр.

482,00

Цена закр.

482,00

Мин. Цена

482,00

Макс. Цена

482,00

Ср/взв. Цена

482,00

-0.16

Кол-во сделок

1

Объем (инвал.)

200 000

0бъем (драм)

96 400 000