Min­is­ter of Fi­nance, Colm Im­bert, says T&T raised US$750 mil­lion in a 10-year bond on the in­ter­na­tion­al cap­i­tal mar­ket yes­ter­day “with­out dif­fi­cul­ty.”

In a news re­lease yes­ter­day, the Min­istry of Fi­nance said the bond was fi­nalised in the amount of US$750 mil­lion (the tar­get amount) at an in­ter­est rate of 6.40 per cent (the tar­get yield), which was just about 2 per cent above yes­ter­day’s open­ing rate of 10-year US Trea­sury Bills.

The bond of­fer, which stayed open for on­ly two-and-a-half hours, was over­sub­scribed by 280 per cent, ac­cord­ing to the min­istry’s news re­lease.

“A Gov­ern­ment bond with a prospec­tive of­fer size of US$750 mil­lion was thus launched with an ini­tial rate in the high 6 per cent range on the Bloomberg Elec­tron­ic Plat­form at around 8:45 am (yes­ter­day) morn­ing.

“By 11:15 am, when the de­ci­sion was tak­en to close the book on the bond, we had re­ceived of­fers to­tal­ing US$2.1 bil­lion, an over­sub­scrip­tion of 280 per cent,” said the Min­istry of Fi­nance.

Pro­vid­ing back­ground on the bond of­fer, the min­istry said it held a nine-hour vir­tu­al road­show on Mon­day, when Im­bert made a pre­sen­ta­tion on sev­en oc­ca­sions through­out the day to in­ter­na­tion­al in­vestors on T&T. He field­ed ques­tions on the man­age­ment of the do­mes­tic econ­o­my from 53 of the most pres­ti­gious as­set man­agers in the USA and Eu­rope.

The road­show on Mon­day start­ed at 8:00 am and went un­til 5:00 pm, vir­tu­al­ly non­stop. It in­volved in­tense scruti­ny and ques­tion­ing by in­ter­na­tion­al in­vestors of the Min­is­ter of Fi­nance on the coun­try’s cred­it rat­ing, its coun­try’s fi­nan­cial sit­u­a­tion, di­ver­si­fi­ca­tion, rev­enue and ex­pen­di­ture, fu­ture prospects for oil and gas pro­duc­tion, for­eign ex­change in­flows and in­ter­ven­tions, man­age­ment of our ex­change rate, for­eign re­serves, the Her­itage and Sta­bil­i­sa­tion Fund, en­vi­ron­men­tal, so­cial and gov­er­nance is­sues, hu­man de­vel­op­ment, cli­mate change, po­lit­i­cal sta­bil­i­ty, democ­ra­cy, pro­cure­ment, ac­count­abil­i­ty, the rule of law, among many oth­er per­ti­nent is­sues.

“The road­show went well and Min­is­ter Im­bert was able to suc­cess­ful­ly an­swer the ques­tions asked, to the sat­is­fac­tion of in­ter­na­tion­al in­vestors,” ac­cord­ing to the min­istry.

The min­istry not­ed the in­ter­est rate of 6.4 per cent over 10 years achieved by the Min­istry of Fi­nance, was just about 2 per cent above yes­ter­day’s open­ing rate of 10-year US trea­sury bills.

He said the mar­gin over US trea­sury bills was a much bet­ter rate than could pos­si­bly be achieved by most coun­tries in Latin Amer­i­ca and all of Cari­com.

“Colom­bia for ex­am­ple, has a spread of 6.5 per cent over US trea­suries to­day, mean­ing that they would have to bor­row at 10.80 per cent if they ap­proached the in­ter­na­tion­al mar­ket (yes­ter­day). Mex­i­co’s spread over US trea­sury bills is 6.25 per cent (yes­ter­day), which means they have to bor­row at 10.55 per cent,” said the min­istry.

“The ex­cel­lent per­for­mance of our US$750 mil­lion in­ter­na­tion­al bond of­fer­ing (yes­ter­day) is con­fir­ma­tion of the con­fi­dence that the in­ter­na­tion­al fi­nan­cial com­mu­ni­ty has in the Min­istry of Fi­nance and the Gov­ern­ment of Trinidad and To­ba­go,” the news re­lease said.

Im­bert thanked and con­grat­u­lat­ed his team in the Debt Man­age­ment Di­vi­sion at the Min­istry and the of­fer’s sole lead man­ag­er/book man­ag­er J.P. Mor­gan for the great work they did on the in­ter­na­tion­al bond, “which was planned and su­perbly ex­e­cut­ed in on­ly one month.”

Yes­ter­day’s bond is­sue was the sec­ond time in less than a year T&T sought fund­ing from the in­ter­na­tion­al cap­i­tal mar­ket. On Sep­tem­ber 11, 2023, the Gov­ern­ment through the Min­istry of Fi­nance, suc­cess­ful­ly is­sued US$560 mil­lion se­nior, un­se­cured long sev­en-year notes at a coupon of 5.95 per cent.

That bond of­fer was in tan­dem with T&T’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 2024.