Fri, 30/11/2012 - 18:57
? The Belarus government has allowed reselling government bonds nominated in foreign currency on the home market. The decision is laid down by Council of Ministers resolution No. 1086 of 27 November 2012. The resolution was published by the national legal information website law.by on 30 November, BelTA has learned. The resolution came into force as of the publication date.The document has expanded the ability of the Belarusian Finance Ministry regarding the primary placement of forex bonds on the home market. Now in addition to selling forex bonds to corporations directly the Ministry can sell them via auctions at the Belarusian Currency and Stock Exchange. The auction rules have to be determined by the Finance Ministry.
The resolution also explains that the government bonds, which are nominated in foreign currency and are placed on the home market, can be short-term and long-term ones with an interest rate. The possibility of floating foreign currency government bonds with the coupon profit has been cancelled.
The press service of the Belarusian Finance Ministry told BelTA the resolution had been passed to improve the terms of floatation and circulation of government bonds in foreign currency. It will encourage the development and the availability of liquidity on the market of foreign currency bonds, said the press service. The document rules out restrictions on trading in forex government bonds on the aftermarket. For the sake of enabling the public and timely floatation of government securities among a large number of investors the document allows floating bonds via auctions held by the Finance Ministry using OAO Belarusian Currency and Stock Exchange.
The Finance Ministry started listing foreign currency bonds on the home market in October 2012. Since then four issues worth a total of $218 million have been listed, with the maturity period of 3.5 years and the interest rate of 7.5% per annum. The buyers were residents of Belarus, including BelVEB Bank and Belarusbank. Besides, the Finance Ministry plans to offer foreign currency bonds to natural persons in the second half of December 2012.
Experts said that allowing government bonds to be traded on the aftermarket will enhance the government?s borrowing ability. It will lead to a considerable increase in the liquidity of the market foreign currency government bonds and an arrival of non-resident investors.
Source: http://forsecurity.org/belarusian-government-bonds-now-secondary-market
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