One-year notes for funding deficit

The Finance Ministry has scheduled releases of treasury certificates and T-bills worth 6,700bn ROL (some 166 million euros) on the domestic market this month, slightly more than the budget deficit and public debt funding requirement set for January. The maximum interest accepted by the Finance Ministry for the government securities due in one year remained 18% on Tuesday, albeit the banks tried to push for more. Under the circumstances, the amount raised from the market amounted to only 44% of the 1,500bn ROL targeted, as every bid asking for more than 18% per year was dismissed. The 18% yearly interest for the government securities maturing in one year and six months had managed to arouse the banks’ interest during the auctions held last week, which had substantially oversubscribed both issues. The one-year bonds had the oversubscription capped at 58% by the Finance Ministry, which raised 1,265bn ROL instead of the planned 800bn ROL. The Finance Ministry intends to borrow 5,300bn ROL for one year this month, attaching less importance to the shorter maturities, with an issue of only 300bn ROL planned for three months and an issue of 1,000bn ROL for six months. ZF