Romania returns to local capital market with new issues of govt bonds


Romania’s Ministry of Finance (MF)  is carrying out on Bucharest Stock Exchange (BVB) a new public offer for the sale of Fidelis government bonds for individual investors in RON and EUR. It is the fourth Fidelis public offer carried out by the Ministry of Finance on the local capital market in almost one year.  Through the first three offers carried out in 2020 and 2021, the Ministry of Finance attracted from the population RON 6.1bn (almost EUR 1.3bn).

Resident and non-resident individuals over the age of 18 years can subscribe Fidelis government bonds denominated in RON and EUR within the public sale offer carried out on the BVB between June 22nd and July 12th, 2021, through BT Capital Partners & Banca Transilvania, BCR and BRD – Groupe Societe Generale.

Government bonds for the population are remunerated with annual interest rates above the level of government bonds traded on the interbank secondary market, according to the Ministry of Finance. There are not any fees charged by the intermediary banks for subscribing to Fidelis government bonds, and the income obtained, both from interest and from capital gains, is non-taxable.

Also, the subscriptions can be made through Eligible Participants, which represent any intermediary authorized by the Financial Supervisory Authority, which is financial investment company or credit institution registered as a participant in the Bucharest Stock Exchange trading system that signed the commitment regarding the conditions of the offer, the provisions of the issue prospectus and sent the commitment to the Lead Manager. The intermediary syndicate of the offer includes BT Capital Partners (Lead Manager) & Banca Transilvania, BCR, BRD.

Romania BVB Fidelis Bonds

The allocation of the government bonds subscribed within the offer will be made on the date of allocation (July 12th, 2021), and the final number of government bonds offered will be established by the issuer in consultation with the intermediation syndicate. The orders related to the subscriptions allocated to investors based on the subscriptions validated by the members of the syndicate / Eligible Participants will be registered in the BVB trading system dedicated to public offers (government bonds). The estimated first trading day is July 16th, 2021.

Of note, the investment activity at BVB continues its upward trend in the first part of 2021, after the record results obtained in 2020 when the investors active on the Romanian stock exchange traded financial instruments totaling RON 18.3 billion, the equivalent of EUR 3.77 billion. It was the highest annual value ever recorded on the main segment of the Romanian stock market, and exceeded by almost 25% the previous record from 2007. In September 2020, the global index provider FTSE Russell promoted Romania to the Emerging Market status.

The capitalization of the local companies listed on BVB has gone above the pre-pandemic level. Thus, the Romanian companies listed on the Main Market of BVB have reached a market value of RON 120 billion or EUR 24 billion.