Purchase TB subscriptions resumed their increase as they gained 28.6 percent at the January 25 auction, to LP517.37 billion ($343.2 million), while maturing bills rose 35.1 percent to LP337.49 billion ($223.4m), thus resulting in an LP179.9 billion ($119.3 million) purchase surplus. Traders reported quiet activity on the secondary market, with most banks trying to replenish their portfolios at the weekly auctions.
Investors maintained their interest in longer-term treasuries, as the 24-M TBs accounted for 41 percent of the total purchase subscriptions, while the share of 12-M TBs edged up 6 percentage points to 31 percent of subscriptions. The shares of the 3-M and 6-M TBs out of total purchase subscriptions were down 4.5 percent and 1.2 percent respectively to a combined 28.2 percent weighting. The BDL sold only LP4 billion ($2.65 million) worth of 60-day certificates of deposit this week.
The focus in Lebanese eurobonds was again on market talk outside of actual trading, which as usual was relatively featureless. The Finance Ministry is expected to tap the $400 million eurobond issue that the government sold last December by an additional $100 million- $150 million, to be co-managed by JP Morgan and Credit Suisse First Boston and to carry a coupon rate of 9.5 percent.
Local banks are expected to pick-up most of the issue with Arab investors participating up to 25 to 30 percent. Furthermore, Finance Minister Fouad Siniora is heading to Japan to explore the possibility of a eurobond denominated in Japanese yen, aimed at lowering the cost of borrowing and diversifying the debt portfolio. The sovereign ratings downgrade by credit agency Fitch came too late in the week to have much impact on the market. — ( Lebanon Invest )
© 2001 Mena Report (www.menareport.com)
