THE RESULTS surprised everyone, even the Ministry of Finance.
The latest US dollar indexed bond has earned the treasury US$173 million, results which indicate that the bond has managed to mop up the US$100 million of liquidity that flowed from a promissory note that matured on September 1.
The offer was "very successful", said Cordell Braham, Finance Ministry spokesman.
Mr. Braham told Wednesday Business that the issue replaces a maturing US dollar bond with a nominal price of 99.565.
Analysts say that while they had expected that "the US$100 million would have been rolled back into the issue", the other US$73 million was above any expectations.
LUKEWARM RESPONSE
Traders had first anticipated that the offer would had a "lukewarm" response from investors, but over the five days of the offer, the instrument suddenly began to look very attractive.
Offered at a fixed 11.75 per cent per annum for three years with an option to extend for a further two years, investors will net about 8.8 per cent on the bond after tax, said analysts, earnings that are about a percentage point above the current 7.9 per cent on the 2005 bond.
The bond was on the market for four days, from September 2-5. A similar bond issued in March had earned the treasury US$108.8 million, but the two US$ indexed bond offers since the start of the fiscal year in April, had averaged US$44 million.
The new issue has increased the Government's outstanding debt on US denominated bonds to US$619.95 million, according to Finance Ministry figures.
