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S.Africa bonds sale twice oversubscribed-Treasury

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S.Africa bonds sale twice oversubscribed-Treasury


The South African government said on Tuesday it raised 5 billion dollars from the sale of two new bonds in international markets, as the transaction was more than twice oversubscribed.

The National Treasury said that the strong demand from investors helped it raise 25 per cent more than it had originally planned.

It said the transaction was more than twice oversubscribed with interest from insurance and pension funds, financial institutions, hedge funds and others from across nearly all continents.

The treasury said it sold the bonds on Sept. 23 in two tranches, raising 2 billion dollars from 10-year notes with a 4.85 per cent coupon and 3 billion dollars from 30-year notes with 5.75 per  coupon.

Citi, Deutsche Bank/Nedbank consortium, Rand Merchant Bank, and Standard Bank were joint bookrunners on the deal.

“The South African government sees the success of the transaction, believed to be the largest ever out of Sub-Saharan Africa, as an expression of investor confidence in the country’s sound macro-economic policy framework and prudent fiscal management,” the Treasury said in a statement.

Only one of the top three ratings firms, Moody’s, ranks Pretoria’s debt at investment grade, while Fitch and S&P Global Ratings have the country’s sovereign debt on junk status.

The agency said South Africa was able to pre-fund an additional 1 billion dollars over the 4 billion dollars it had originally planned to raise.

The country recorded better-than-expected growth of 3.1 per cent in the second quarter following a deep first quarter contraction, but analysts fear maintaining growth at that level is unlikely. (Reuters/)
JI/PDE

(Editing by Joe Idika/Peter Ejiofor)

Joseph Idika: is a graduate and a professionally trained journalist, with experience in national news reporting/editing and verification at the News Agency of Nigeria. NNN is a Nigerian online news portal that publishes breaking news in Nigeria, and across the world. Our journalists are honest, fair, accurate, thorough and courageous in gathering, reporting and interpreting news in the best interest of the public, because truth is the cornerstone of journalism and they strive diligently to ascertain the truth in every news report. Contact: editor[at]nnn.com.ng

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