JavaScript is disabled in your web browser or browser is too old to support JavaScript. Today almost all web pages contain JavaScript, a scripting programming language that runs on visitor's web browser. It makes web pages functional for specific purposes and if disabled for some reason, the content or the functionality of the web page can be limited or unavailable.

Monday, June 16, 2025

Term sheet re­veals:

Govt raising US$100M to repay maturing bond

...sourced US$560M in Sept 2023

by

Anthony Wilson
528 days ago
20240105
Finance Minister Colm Imbert

Finance Minister Colm Imbert

KERWIN PIERRE

Gov­ern­ment is look­ing to raise US$100 mil­lion on the lo­cal cap­i­tal mar­ket, with Re­pub­lic Bank Ltd and First Cit­i­zens Bank Ltd named as the co-lead arrangers, ac­cord­ing to a term sheet for the bond that was seen by Guardian Me­dia Ltd.

The term sheet was be­ing wide­ly cir­cu­lat­ed to high net-worth in­di­vid­u­als, mu­tu­al funds and pen­sion plans yes­ter­day as the funds need to be in the Gov­ern­ment’s ac­count by the mid­dle of Jan­u­ary.

The bond is par­tial­ly amor­tis­ing, mean­ing the se­mi-an­nu­al pay­ments would be a com­bi­na­tion of prin­ci­pal and in­ter­est. The prin­ci­pal on the bond will be made in five equal, se­mi-an­nu­al prin­ci­pal pay­ments of US$10 mil­lion com­menc­ing in Ju­ly 2024. As a re­sult, bond­hold­ers will re­ceive a US$50 mil­lion bul­let pay­ment at ma­tu­ri­ty in Jan­u­ary 2027.

The bond is fixed rate and ma­tures in three years. It pays an in­ter­est rate of 6.65 per cent per year but be­cause the fa­cil­i­ty is par­tial­ly amor­tis­ing, the yield would be 6.25 per cent.

With re­gard to the se­cu­ri­ty for the bond, the term sheet states: “Prin­ci­pal and in­ter­est rep­re­sent­ed by the fa­cil­i­ty will be charged up­on and payable out of the Con­sol­i­dat­ed Fund of the Re­pub­lic of Trinidad and To­ba­go and se­cured on the rev­enues and as­sets of the Re­pub­lic of Trinidad and To­ba­go.”

The pur­pose of the bond is “to re­pay an ex­ist­ing Gov­ern­ment US$100 mil­lion bond that is due to ma­ture on Jan­u­ary 16, 2024.”

But in a news re­lease is­sued on Sep­tem­ber 13, 2023, the Min­istry of Fi­nance in­di­cat­ed that the Gov­ern­ment had suc­cess­ful­ly raised US$560 mil­lion on the in­ter­na­tion­al cap­i­tal mar­ket in or­der to re­fi­nance a US$550 mil­lion bond that is due to ma­ture in Jan­u­ary 2024.

The Min­istry of Fi­nance de­scribed the Sep­tem­ber 2023 bond as a “suc­cess­ful, heav­i­ly over­sub­scribed bond is­sue by the Re­pub­lic of Trinidad and To­ba­go of US$560 mil­lion on the in­ter­na­tion­al cap­i­tal mar­ket.”

In the news re­lease, the Min­istry of Fi­nance said: “On Mon­day Sep­tem­ber 11, 2023, the Gov­ern­ment of the Re­pub­lic of Trinidad and To­ba­go, through the Min­istry of Fi­nance, suc­cess­ful­ly is­sued US$560 mil­lion se­nior un­se­cured long sev­en-year notes at a coupon of 5.950 per cent on the in­ter­na­tion­al cap­i­tal mar­ket. The of­fer was over­sub­scribed by three times the amount re­quired.”

The min­istry said the “pro­ceeds from the is­suance and sale of the notes will be used for re­fi­nanc­ing the Re­pub­lic’s out­stand­ing 4.375 per cent notes due Jan­u­ary 2024.”

The Sep­tem­ber 11, 2023, bond is­sue for US$560 mil­lion “was in tan­dem with the Gov­ern­ment’s an­nounce­ment on Sep­tem­ber 5, 2023, of the com­mence­ment of a cash ten­der of­fer to pur­chase any and all of the out­stand­ing US$550 mil­lion ag­gre­gate prin­ci­pal amount of its 4.375 per cent notes due in Jan­u­ary 2024,” ac­cord­ing to the Min­istry of Fi­nance.

The Sep­tem­ber 2023 news re­lease said the “trans­ac­tion al­so re­alised 41 per cent par­tic­i­pa­tion in the Re­pub­lic’s cash ten­der of­fer, which was an of­fer made to ex­ist­ing bond­hold­ers to re­deem their ex­ist­ing notes due in 2024 ear­ly and ex­change them for cash four months ahead of the ma­tu­ri­ty date in Jan­u­ary 2024.”

The Min­istry of Fi­nance said the ex­cep­tion­al suc­cess of the Sep­tem­ber 2023 bond is­sue un­der­scored the mar­ket’s con­fi­dence in T&Ts cred­it and sus­tain­abil­i­ty pro­file.

“Com­pre­hen­sive prepa­ra­tion, good man­age­ment of the coun­try’s fis­cal ac­counts and rapid but strate­gic ex­e­cu­tion have al­lowed us to man­age re­fi­nanc­ing risk in a way that is pro­tec­tive of our pub­lic fi­nances.” said Fi­nance Min­is­ter Colm Im­bert, in com­ment­ing on the trans­ac­tion.


Related articles

Sponsored

Weather

PORT OF SPAIN WEATHER

Sponsored