Israel raises 250 million euros at a rate close to zero

The Israeli government is raising debt at a near-zero interest rate: a bond issue private 250 million euros to an Asian strategic investor. The three-year bonds bear an annual interest of 0.05%, the lowest ever paid by the Israeli government. The Ministry of Finance is required to disclose information about the buyer, but sources inform "Globes" that the buyer is a government fund from an Asian country, such as the Singaporean government's Temasek. Berkley's Capital, a market maker in the government bond market, was the underwriter of the issue.

Finance Accountant General Rony Hizkiyahu and Assistant Accountant Gil Cohen led the case. The Ministry of Finance has previously raised similar amounts in dollars, but this is its first issue in euros. The Ministry of Finance estimates that the interest rate is 0.25% lower than what it should have paid in the public issue of the type that it usually holds each year.

The Ministry of Finance has held a number of private issues for strategic In recent years, investors have raised $ 400 million of bonds at one year to 1.6% annual interest in 2011 and $ 200 million of LIBOR + 2% LIBOR + 2-year fixed rate bonds in 2012. The Department of Finance says the interest rate this time because the benchmark was the rate of the European Central Bank, which is zero, with negative interest rates on bank deposits. The positive sentiment towards the Israeli economy has also contributed to the low interest rate, as evidenced by the announcement by the credit rating agency Moody's, last week, positive results of the Israeli rating.

Published by Globes [online] Israel Economic News – www.globes-online.com – 23 July 2018

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