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Latvia issues seven-year bonds to raise USD 1.25 billion

Finance Minister Andris Vilks. Photo: LETA.
 RIGA, Dec 6 - Yesterday Latvia successfully issued seven-year government bonds, raising USD 1.25 billion.
The annual interest rate was set at 2.75 percent, the rate of return is 2.889 percent - the lowest interest on Latvia's borrowings on the international financial markets, as the Finance Ministry informed "Nozare.lv".
The bond issue was organized in accordance with the government's borrowing strategy and taking into account the especially favorable situation on the foreign markets at the moment.
Investors' interest in the bonds was very great, and the bonds were sold to investors from Europe, the United States, and other regions.
The bond issue was organized "Barclays", "Deutsche Bank" and "JP Morgan".
Finance Minister Andris Vilks (Unity) is pleased at the success of the bond issue. "As Latvia's credit ratings improve, we have a unique opportunity to refinance our external debt on international financial markets, at an interest lower than that at which we borrowed from the European Commission during the international loan program," said the minister.
As a result, the cost of servicing the state debt will reduce in the medium term, said Vilks.
"The successful bond issue clearly shows foreign investors' appreciation of what has been achieved in the Latvian economy," added the minister.
As reported, this past February Latvia raised USD 1 billion in a five-year bond issue. The annual interest rate of 5.25 percent was higher than the government had originally planned; the rate of return was at 5.375 percent, informed the Finance Ministry.

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