Greece T-bills Raise €1.3 Billion Amid Bond Rumors

marketsOn Tuesday, Greece managed to raise €1.3 billion with a sale of six-month treasury bills, while looking set to return soon to borrowing for longer periods after issuing its first sovereign bond since 2010.

“Total bids reached €3.103 billion and the amount finally accepted was €1.3 billion,” the Greek Public Dept Management Agency (ODDH) said on the sale, which secured an interest rate of 3.01 percent, down 59 basis points from an equivalent March auction (3.6 percent).

Today’s sale was the lowest funding cost on six-month T-bills since January 2010, when the agency sold similar paper at 1.38 percent.

Greece lost access to bond markets four years ago, when its debt crisis erupted and monthly T-bill sales are its sole source of market funding.

“There was strong foreign interest, most of the issue went to foreign buyers,” said an ODDH official, adding that foreigners bought about 80 percent of the issue. Foreign take-up of treasury issues in the last three months had hovered at around 40 percent.

Meanwhile, sources have suggested that the Greek government is planning to tap markets with a five-year bond sale to raise around €1.5bn – €2bn only from foreign investors as early as this week, timed around Friday’s scheduled visit by German Chancellor Angela Merkel.

Greek Finance Minister Yannis Stournaras, however, appeared to deny reports on Monday.

“There is no rush. We do not need this money to cover a funding gap,” the Finance Minister said, adding: “We are testing the water and trying to smooth the yield curve.”

Stournaras denied that the government was considering a bond issue this or next week in order to overcome the fiasco of Panayiotis Baltakos having to resign from cabinet secretary over his contact with a Golden Dawn MP.

“We are not going to take the risk of returning to markets for political reasons,” Stournaras mentioned.


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