Romania Considers 15-Year State Bond Issue

05.10.2011 ZF English

Romania’s Finance Ministry talks with pension funds and insurance companies about launching 15-year state paper this year if enough critical mass is achieved, state secretary Bogdan Dragoi said Tuesday.

"We are talking with pension funds and insurance firms about launching 15-year bonds, which will help in reducing (financing) costs … The problem is reaching a critical mass for such an issue, and only those companies have resources for such a long term," Dragoi said.

He said a first round of talks was already held, and other meetings are planned for later this year.

On the other hand, Romania needs a solid secondary market for state treasuries to reduce financing costs, Dragoi added.

"We will get a good price on the primary market, if there are secondary market references. We need to build a liquid secondary market, with large volumes and as many issues as possible," Dragoi said.

In the past two years, Romania managed to sell bonds of up to 10-year maturities.