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Portugal to issue 4 bln euros more in bonds than forecast

Xinhua, March 5, 2015 Adjust font size:

Portugal will issue 4 billion euros (4.43 billion U.S. dollars) more in bonds than was initially forecast this year, and will reduce its financial cushion by 2 billion euros in order to reimburse the International Monetary Fund (IMF), President of Portugal's debt agency Cristina Casalinho said on Wednesday, according to Portuguese News Agency Lusa.

"The emissions scheme was altered by 6 billion euros: 2 billion euros will result from the reduction of liquidity reserves and 4 billion from the rise in emissions," Casalinho said at parliament on Wednesday when questioned by a Socialist MP on how the country will reimburse the IMF.

Portugal's Finance Minister Maria Luis Albuquerque recently announced that Portugal would follow Ireland in making an early repayment to the IMF, taking advantage of low borrowing costs for European peripheral governments.

Portugal is planning to repay its 14 billion euro IMF debt early, and will reimburse 6 billion euros by the end of March, Luis Albuquerque revealed last week.

Portugal signed a bailout fund in May 2011 with the European Commission, the IMF and the European Central Bank when it was on the verge of bankruptcy, and successfully exited that program in May last year.

The IMF lent Portugal 26.9 billion euros, which carried a 3.7 per cent tax rate and an average loan maturity of 7 years.

Portugal issued 1.499 billion euros in 10-year bonds at an average yield of 2.0411 percent last Wednesday. Endit