Portugal opens books on new 10-year bond as interest tops EUR4bn

Tue May 7, 2013 4:34am EDT

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LONDON, May 7 (IFR) - The Republic of Portugal, rated Ba3/BB/BB+, has opened books on a no-grow EUR3bn 10-year bond, with official guidance set at mid-swaps plus 400-405bp, a bank managing the deal said on Tuesday.

Indications of interest from investors topped EUR4bn when lead banks marketed the deal at initial price thoughts of mid-swaps plus 405bp area earlier on Tuesday.

Banks said European books would close at short notice because of the strong initial demand.

Portugal's outstanding 10-year bond, maturing in October 2023, was bid at mid-swaps plus 391.5bp when the price thoughts were released, indicating that investors are being offered a new issue premium of between 8.5bp and 13.5bp to buy the new issue, maturing in February 2024.

Caixa Banco de Investimento, Citi, Credit Agricole, Goldman Sachs, HSBC and Societe Generale are managing the deal, in what could be a step towards the country qualifying for the European Central Bank's bond-buying scheme. (Reporting by John Geddie, editing by Julian Baker)

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