Prices of Azerbaijani eurobonds reach a record high

Baku. 26 October. REPORT.AZ/ Prices of the bonds, marketed by the Azerbaijani Ministry of Finance in the European capital market on March 18, 2014 for 10 years have reached a record high.

Analyst of the 'Capital Management Investment Company' CJSC, Jafar Ibrahimli told Report.

According to him, 1.25 mln Eurobonds (1.25 bln US-dollars) at par value of 1 000 USD, are currently, sold with a yield of 4% per annum: "Securities are purchased by 104.25% (1 042.5 USD) compared to face value, sold by 104.75% (1 047,5 USD). However, the Eurobonds with annual coupon rate of 4.75% placed with annual yield of 5%. It means that borrowing percentage for the country made 5%."

"In February this year, purchase and sale price of the bonds made 98-99% of its face value after repeated devaluation of Azerbaijani manat. Now, 6-7 percentage points difference is observed in purchase and sale price. That is, those, who bought Azerbaijani Eurobonds 8-9 months ago, got yield of 6-7% in USD during this period", J.Ibrahimli noted.

He said that is means substantial improvement of Azerbaijan's position in the capital market despite double devaluation and economic difficulties: "In addition to promising 15-20% yield through issued bonds in manat, the Finance Ministry may attract funds at lower interest than the previous placement (about 4%) and change the country's balance of payments for the better by placing Eurobonds in US-dollars".