Bulgaria Investors Overwhelm Government Securities Auction

The second auction within a week of Bulgarian government bonds was three times over-subscribed, as investors were attracted by high interest rates. Photo by BGNES

Bulgaria’s second government securities auction within one week was oversubscribed by almost three times, as high interest rates attracted potential investors.

The auction of government securities on Friday was as successful as the previous one, held on February 22. Both have been totally over-subscribed, as investors scrambled to buy in to the BGN 30 M worth of securities on offer.

On Friday, demand was 2,7 times over the offered amount. Total bids were for approximately BGN 81,1 M, at an average yield of 5,95%.

At the closing of the auction, the bonds were registered at a 5,86% yield, similar to the result five days before, when a figure of 5,82% was realized.

The bonds issued on Friday mature after a period of 10,5 years, on July 13, 2020 and have a fixed interest rate of 5% payable every six months.

Earlier in February, the Bulgarian government had issued Euro bonds for the first time in five years, an event that also triggered a strong interest among investors.

The Finance Ministry's schedule for March provides for two further auctions for a total of BGN 65 M, while for the full calendar year, bonds totaling BGN 740 M are to be offered.

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