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Greeks raise €5bn in new bond issue

GREECE raised €5bn (£4.49bn) by issuing a seven-year syndicated bond yesterday, days after agreeing a last-ditch bailout package with the eurozone and the International Monetary Fund (IMF).

The bonds were sold with a 5.9 per cent coupon and were listed on the Athens Stock Exchange.
Alpha Bank, Bank of America Merrill Lynch (BoAML), Societie Generale, ING and Credit Agricole’s Greek subsidiary Emporiki were the lead managers of the bond, which has been rated by Moody’s, Standard & Poor’s, Fitch, and Ratings and Investment Information.

The bond is one of several measures taken by the debt-stricken country to reduce its €300bn (£269bn) mountain of debt. Greece, led by Prime Minister George Papandreou, needs to raise €54bn this year.

Petros Christodoulou, head of the Public Debt Management Agency (PDMA), said the bond enables Greece to complete all of its funding requirements for April.

“Although it is positive that the bond got done, there is still some doubt because there is still potential for Greece to get into more trouble. The bond has moved everything forward one step but they haven’t reached closure,” said Gary Jenkins, head of fixed income research at Evolution Securities.

The move by Greece comes just a few days after eurozone leaders agreed a joint International Monetary Fund (IMF) bailout package worth €22bn (£19bn) for the country.

Under the agreement, which was endorsed by France and Germany, eurozone leaders will provide two-thirds of the package, while the IMF will fund the remainder if Greece cannot raise the funds from the markets.

The support package will only be activated should the Greek government decide it needs the help.

NICK DENT
BANK OF AMERICA
MERRILL LYNCH

NICK Dent, head of the public sector syndicate at Bank of America Merrill Lynch (BoAML), led the team that advised on the €5bn (£4bn) bond issuance by debt-stricken Greece.

Dent has run the public sector syndicate at the bank for the last five years after he joined from Credit Suisse. He was brought in to replace Stuart McGregor, who was moved to a different department.

During his career, he has advised on a raft of similar deals to the Greek one, including the sale of C$3bn (£1.95bn) five year bonds for the Canadian government earlier this month and the issuance of a $4bn (£2.6bn) three year bond issue for Germany.

BoAML was one of a number of lead managers on the recent bond issue for Greece and joined Societie General, ING, Alpha Bank and Emporiki, the Greek arm of Credit Agricole.

The bond was issued yesterday and marked a crucial moment for the country since the agreement of a last ditch bailout package involving the eurozone and the IMF.