Bulgaria Takes on Another 300 Million Leva in Domestic Debt After Eurozone Green Light

Bulgaria has secured an additional 300 million leva in debt from the domestic market, according to the results of the latest government securities auction held by the Bulgarian National Bank (BNB). This is the first bond issue following the favorable assessments from both the European Central Bank and the European Commission regarding Bulgaria’s progress toward adopting the euro.

With this new tranche, the total amount of domestic debt issued by the country since the start of the year has reached 2.1 billion leva. On the international front, Bulgaria also placed €4 billion in foreign debt in April, distributed across two separate tranches.

The auction conducted by the BNB involved the sale of a portion of a previously opened seven-year interest-bearing government bond issue (Num. BG 20 400 25 210/29.01.2025), which is set to mature on January 29, 2032. The terms of the sale were determined by the Ministry of Finance.

According to the published announcement, the Finance Ministry offered bonds worth 300 million leva with a fixed annual coupon rate of 3.25%. Interest payments on this issue are made semi-annually, beginning from the date of issuance, with the final interest payment coinciding with the return of the bond's principal value. The settlement date for the approved bids is June 18, 2025.

Demand at the auction was strong. Orders totaling nearly 529 million leva in nominal value were submitted, including non-competitive bids worth 38.5 million leva. The overall coverage ratio stood at 1.76, indicating that demand exceeded the supply by 76%.

The average accepted price across all bids was 100.93 leva per 100 leva nominal, the BNB stated. The Ministry of Finance approved bids totaling the targeted 300 million leva, which included the full volume of non-competitive orders. The yields on the approved bids varied slightly: the minimum accepted price was 100.90 leva (yielding 3.12% annually), and the maximum reached 101.92 leva (with a 2.95% yield). The weighted average price settled at 101.26 leva per 100 leva nominal, corresponding to an annual yield of 3.06%.

Eight primary dealers of government securities participated in this auction. The Ministry of Finance has also announced that it plans to offer additional amounts of this bond issue in future auctions.