Greece announces new bond issue ending three-year market exile

The Greek government has announced it will complete a new five-year bond issue, in its first such offering since 2014.

Read more: Greece is exploring first new government bond issue since 2014 if it secures a debt relief deal, reports say

Greece has also invited holders of its 4.75 per cent outstanding bonds, due to mature in 2019, to tender them for cash at a price of 102.6 per cent of their nominal amount.

It said it had mandated BNP Paribas, Citigroup Global Markets, Deutsche Bank, Goldman Sachs, HSBC and Merrill Lynch as joint lead managers for the benchmark size offering. The new bonds will reportedly have a yield of 3.6 per cent.

The sovereign last issued in July 2014 when it raised €1.5bn in notes which matured on 17 July 2017. It also raised €3bn in April 2014 which is due April 2019.

This time, Greece is said to be seeking between €2bn and €4bn. However, the country’s sovereign bonds are still not eligible to be bought by the European Central Bank (ECB), as the ECB’s president Mario Draghi said last week it was “premature” to talk about buying Greek debt as part of the central bank’s quantitative easing programme.

Read more: Eurogroup agrees €8.5bn deal for Greece

Greece still has a €326bn debt pile, after receiving three bailouts in the last seven years.

Its return to the markets had been predicted over recent weeks, after the country’s largest creditor – the European Stability Mechanism – said last month that Greece should develop a strategy to end its three-year exile.

Read more: Greece returns to recession after bailout battle dragged on growth