Lithuania has issued a 10-year Eurobond


2022 05 25


Today Lithuania borrowed EUR 650 million in the international capital markets by issuing a 10-year Eurobond. The annual coupon was set at 2.125 per cent.

During this issuance, a risk premium of 60 basis points above the mid-swap interest rate was set. In 2020, when the 10-year Eurobond issue was last issued, this risk premium was equal to 90 basis points. This means that investors assess Lithuanian credit risk more favourably than two years ago.

‘As the policies of central banks change and interest rates rise, we took the opportunity to secure funding at favourable terms. Lithuania has offered investors the most attractive 10-year term and we hope to offer this issue again at domestic auctions’, vice-minister Gediminas Norkūnas said.

Proceeds of this issue will be used to finance this year's borrowing needs in order to mitigate the effects of Russia's military invasion to Ukraine and the resulting geopolitical and economic crisis, i.e. for measures dedicated to mitigate effects of rising inflation caused by the war, for social assistance, education and health services of Ukrainian refugees, for costs of critical infrastructure maintenance, caused by sanctions against Russia and Belarus, and for infrastructure projects co - financed by the EU.

The Eurobonds have been issued at a yield of 2.272 per cent and issue price equal to 98.698 per cent of their face value. The settlement for the issue will take place on 1 June 2022. The Eurobonds will mature on 1 June 2032.

The transaction was lead-managed by banks Barclays and BNP Paribas.


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