Albanian Eurobond rates increased

05/08/2011 08:15

Albania’s sovereign bonds that were issued in Euro last year, have suffered a
plunge in their nominal interest value and increase of
0.5% in the interest rate.

The news was confirmed by the Ministry of Finances, which says that if a new bond was to be issued in this moment, the price offered by the buyers would be 8%, while only last year it was valued with 7.5%.

This increase of the value is considered as a loss for the first buyers, who loaned money in exchange of a 7.5% interest. While those who are buying in the secondary market, are benefiting an interest of 8%.

This means that if the buyers have paid 50,000 EUR for a bond, now can sell this and take back 0.5% less of the initial 50,000 EUR.

However, the Ministry of Finances explains that the number of transactions for the Albanian bond has been limited.

“This comes from the fact that the initial buyers were long-term and serious investors, differently known as ‘buy and hold’, not market speculators who would want to sell their assets for a short-term benefit”, says for Shqip Newspaper Xhentil Demiraj, director of the debt management in the ministry.

Top Channel