The Dominican Republic sold US$2.5 billion in bonds this week, the largest amount in the country’s history. US$1.5 billion in 2045 bonds were issued at 6.85% interest, and US$1 billion in 2025 bonds at 5.5% interest. The book runners for the 2015 bond placement operations were the Bank of America, Merrill Lynch and JP Morgan.
In 2014, the Medina administration placed US$1.25 billion in bonds at 7.45% for expiration in 2044. In 2013, the Medina administration had placed US$1 billion at 5.875% in April and US$500 million in October at 6.6%, both for expiration in 2024.
The Dominican Republic has nine outstanding bond issues for US$8.26 billion and in pesos RD$12 billion.
In an interview with Diario Libre, economist Pavel Mora speculated that the bond money could be put to good use if it pays back bonds that were placed at higher interest rates.
Reporting on the bonds, Bloomberg highlights that the sale comes after Fitch Ratings raised the country’s rating in November to B+. The improvement was attributed to the 7% increase in the economy in 2014, with a repeat expected for this year. The economy is reflecting the increase in gold exports, growth in tourism and shrinking current account deficit.
http://www.bloomberg.com/news/2015-01-20/dominican-republic-plans-to-issue-at-least-1-billion-of-bonds.html
http://em.cbonds.com/news/item/754397
http://em.cbonds.com/news/item/754401
http://em.cbonds.com/countries/Dominican-bond
http://www.diariolibre.com/economia/2015/01/22/i978571_califican-positiva-colocacin-us2-500-millones-bonos-soberanos.html