Lebanese Eurobond market
Despite last week’s downgrading by credit agency Fitch, attention in the Eurobond market was more focused on the new tapped sovereign issue of $200 million, adding to the existing semiannual $400 million issue maturing December 14, 2004 and carrying a coupon of 9.5 percent. The bond was priced at a par value of 100 and spread of 465 b.p. over the US Treasury curve.
JP Morgan and Credit Suisse First Boston acted as lead managers of the Eurobond, which will be listed on the Luxembourg Bourse. The bond was mainly placed with local banks. Furthermore, Finance Minister Fouad Siniora confirmed this week that Japan is willing to issue “Samurai” bonds for the Lebanese Republic denominated in Japanese yen, carrying lower interest rates than dollar denominated bonds. US Treasuries struggled for three consecutive days this week before rising on Thursday, February 8, as bond dealers succeeded in absorbing $10 billion in new long-term bonds.
The Treasury Department sold its new 30-year bonds at a high yield of 5.46 percent, closing its quarterly auction of $32 billion in notes and bonds. The Labor Department reported that the productivity of US workers in the non-farm sector, a key measure of rising living standards, slowed to a 2.4 percent rate of growth in the fourth quarter of 2000, compared with a downwardly revised 3 percent in the third quarter, reflecting a cooling economy. In addition, labor costs increased by 4.1 percent from an upwardly revised 3.2 percent jump in the previous quarter. — ( Banque du Liban et d'Outre-Mer Sal )
© 2001 Mena Report (www.menareport.com)