Already on ArticleSlash?

Forgot your password? Sign Up

Bond Development In Croatia - Making Waves In The International Market

Pauline Go
 


Visitors: 114

The international capital market has seen Croatia becoming an established issuer of bonds and securities since its début. The first small international bond of US$60 million issued in its local currency - kunas -was in December 1996 and there was no looking back after that. In February 1997, Croatia issued its first Eurobond in the US dollar sector only after obtaining its first credit rating of Baa3 and BBB, from Moody's, and Standard and Poor's.

The initial Kuna bond, which was targeted at international investors, had a maturity of two years and a 12.5 percent coupon rate with an implying yield of just over 13 percent. This issue was deemed a success as it had a strong demand of currency and credit diversification. Aiming to build a benchmark in company issuance the maturity constituted an extension of the kuna yield curve.

Croatia issued its first dollar bond of a whopping amount of US $300 million in February 1997, which had fixed coupon of 7 percent and had a five year bullet. This led to a three to four times oversubscription offering diversification and bringing a new European name to the market. The lead managers geographically allocated the bonds and about half of the issue was sold in Europe, some 40 percent allocated in the United States and the rest allocated to Asian countries.

Croatia's entry in the international bond market and its debut marked the achievement of a successful macroeconomic stabilization. This led to:

  • A solid economic growth rate
  • A fiscal position that can be managed
  • Reduction in inflation due to its strong currency

    An agreement with the creditors of the former socialist republic of Yugoslavia led to a low external debt level with a strong reserve position, the diversity of its production and also its location. Croatia has indeed made a mark with its debut in the international capital market.

    About Author: Pauline Go is an online leading expert in finance industry. She also offers top quality finance tips like:

    How to get good auto loan , Government Bonds And ROI , Find Local Federal Credit Union

  • (360)

    Article Source:


     
    Rate this Article: 
     
    Bugatti Veyron 16.4 Making Waves Around The World
    Rated 4 / 5
    based on 5 votes
    ArticleSlash

    Related Articles:

    Market Research For International Business Development

    by: Cindy King (October 03, 2008) 
    (Business/International Business)

    Croatia Real Estate Market

    by: Edvard Kurnik (September 28, 2008) 
    (Real Estate/Selling)

    Small Business Development Tool - Your Monthly Newsletter - An International ..

    by: Cindy King (February 06, 2008) 
    (Business/Small Business)

    Making Waves with the Skirtini

    by: Judy Phan (March 01, 2010) 
    (Womens Interests)

    Making Waves In Morocco

    by: Joshua Bennett (August 04, 2010) 
    (Travel and Leisure/Adventure Travel)

    Making New Waves in Online Advertising

    by: James Krawder (June 03, 2007) 
    (Internet and Businesses Online)

    Making Waves by Cassandra King

    by: Joy Cagil (December 01, 2008) 
    (Book Reviews/Fiction)

    Making WAVEs in Distribution Sales

    by: Ken Rogner (July 06, 2008) 
    (Business/Sales)

    Fuji Digicams Making Waves!

    by: Jayson Pablo (December 19, 2007) 
    (Shopping and Product Reviews)

    Bugatti Veyron 16.4 Making Waves Around The World

    by: Natalie Anderson (March 12, 2007) 
    (Automotive)