The Treasury made a repurchase of the international bond, for an amount of RD$37,221 million, indexed to Dominican pesos, maturing in 2023.
This was reported by the entity when indicating that the issuance of indexed securities was carried out in both local and foreign currency.
“The resources from these emissions, for a total amount equivalent to $1.8 billionwill be used for the repurchase of the referred title as well as to cover part of the needs of the PGE 2023 ”explained the Treasury.
According to the information, the first instrument was issued for US$700 million, with a coupon of 7.05% and maturity in 2031. Meanwhile, the second, denominated in Dominican pesos, for US$1,100 million (RD$62,282 million) with a coupon rate of 13.625%, maturing in 2033.
The Treasury explained that the bond in pesos has an important effect on the debt portfolio of the Non-Financial Public Sector, because it reduces the proportion of debt in foreign currency, mitigating the risk exchange rate in tax accounts.
Likewise, the institution highlighted in a press release that the bond denominated in pesos adds liquidity and visibility to the Dominican currency and its instruments in the international market.
“Is operation of repurchase and issuance at the present time allowed the Government to secure resources in US dollars up to the middle of the year without putting pressure on the domestic exchange rate, without incurring a high cost, taking into account the current interest rate conditions,” said Jochi. Vincent, Minister of Finance.
He pointed out that the results of the operation are a clear effect of the recent upgrade from BB- to BB by Standard and Poor’s, which reflects the confidence and robustness of the Dominican Republic’s sovereign credit.
Meanwhile, the Vice Minister of Public Credit, María José Martínez, described as a success the demand received from the issuance of the new instruments, where investors presented positions four times the amount announced in pesos and 10 times in dollars.
In the same way, he explained that the repurchase of the instrument with a maturity of 2023 was extremely positive, receiving and accepting a total of RD$37,221 million in offers, which represent 93.05% of the total amount of circulation of the title offered, demonstrating the confidence of investors. in our economy by showing greater interest in a new title with a higher tenor in an instrument indexed to the local currency.
Vicente and Martínez were the authorities of the Dominican Government who led the transaction, with the support of the technical team of the General Directorate of Public Credit. The institutions that served as structuring banks for the transaction were Citigroup Global Markets and JP Morgan Securities.
