Greek T-bills oversell as rescue talks start
By Derek Gatopoulos |
April 21, 2010, Wednesday
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Print Edition
Print Edition
GREECE has raised 1.95 billion euros (US$2.62 billion) in a 13-week treasury bill auction that was more than four times oversubscribed, the public debt management agency said yesterday.
The auction was aimed at shaving the country's crucial borrowing requirement for May, as Athens mulls whether to use a joint eurozone-International Monetary Fund rescue package. Talks with European and IMF officials on the package are due to start in Athens today.
Finance Minister George Papaconstantinou said he would travel to the United States on Friday for an IMF meeting, and would hold talks with US Treasury Secretary Tim Geithner and IMF Chief Dominique Strauss-Kahn.
Yesterday's auction sought to raise 1.5 billion euros and was oversubscribed by 4.61 times, with 6.921 billion euros in offers, the debt management agency said, adding that it also accepted 450 million euros in non-competitive bids. The yield for the 13-week bills stood at 3.65 percent, compared to the 1.67 percent yield from a similar bill issued in January that was oversubscribed by 3.23 times.
"The message of today's auction is that we raised 1.95 billion euros, so our borrowing requirements for May have fallen below 10 billion euros - and that's very important," Papaconstantinou said.
Last week, Greece successfully raised 1.56 billion euros in six-month and 12-month treasury bill auctions, but at punishingly high rates. The yield for the 12-month bill sold last Tuesday stood at 4.85 percent compared to 2.2 percent for the previous issue in January, while the yield for the six-month bills was 4.55 percent compared to 1.38 in a similar auction in January. Greece's cost of borrowing has spiraled in recent weeks as the nation struggles to avoid default or asking for a bailout.
The auction was aimed at shaving the country's crucial borrowing requirement for May, as Athens mulls whether to use a joint eurozone-International Monetary Fund rescue package. Talks with European and IMF officials on the package are due to start in Athens today.
Finance Minister George Papaconstantinou said he would travel to the United States on Friday for an IMF meeting, and would hold talks with US Treasury Secretary Tim Geithner and IMF Chief Dominique Strauss-Kahn.
Yesterday's auction sought to raise 1.5 billion euros and was oversubscribed by 4.61 times, with 6.921 billion euros in offers, the debt management agency said, adding that it also accepted 450 million euros in non-competitive bids. The yield for the 13-week bills stood at 3.65 percent, compared to the 1.67 percent yield from a similar bill issued in January that was oversubscribed by 3.23 times.
"The message of today's auction is that we raised 1.95 billion euros, so our borrowing requirements for May have fallen below 10 billion euros - and that's very important," Papaconstantinou said.
Last week, Greece successfully raised 1.56 billion euros in six-month and 12-month treasury bill auctions, but at punishingly high rates. The yield for the 12-month bill sold last Tuesday stood at 4.85 percent compared to 2.2 percent for the previous issue in January, while the yield for the six-month bills was 4.55 percent compared to 1.38 in a similar auction in January. Greece's cost of borrowing has spiraled in recent weeks as the nation struggles to avoid default or asking for a bailout.
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