On Friday around noon, Croatian Ministry of Finance invited investors to participate on issuance of new 1.5Y FX treasury paper in order to partially finance EUR 1.5bn worth of RHMF-T-906X that matures on February 7th. Auction of EUR 1bn worth new paper, RHMF-T-019X, will be held on the last day of January with settlement taking place on February 7th, so investors that hold RHMF-T-906X could just roll maturing bill with freshly issued one. It is worth mentioning that maturing paper was issued at 10bps while on the last few EUR T-bill auctions yield was pure zero.
Meanwhile, earlier Poslovni dnevnik said that Ministry of Finance plans to issue EUR 1bn worth of FX treasury bill while the rest of the outstanding EUR 500m could be rolled into 3y EUR indexed paper and 10Y LCY bond.
Furthermore, according to the same article, MinFin could use still low yield environment and elevated liquidity surplus in the financial system to issue even more, i.e. HRK 3-4bn to finance 2019’s budget deficit that was projected around HRK 4bn. All in all, we’ll have interesting two weeks on Croatian bond market and then Ministry of Finance could go on auto-pilot until November when USD CROATIA 2019 and RHMF-O-19BA should be rolled.