Albania Eurobond

Albania taps international market with Eurobond deal

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Albania has concluded the issuance of a new 650 million ten-year Eurobond with a coupon of 3.5%,
and a long-term interest rate of 3.75%, the Minister of Finance and Economy, Delina Ibrahimaj, said during a press conference on Wednesday (Nov. 24).

According to the Minister, the issuance of the Eurobond is of great importance not only for providing the necessary liquidity to finance the budgetary needs of the Albanian government for 2021 and 2022, but also for guaranteeing the Southeast European country’s presence in international markets and
proving the confidence of foreign investors in the Albanian economy.

The issue attracted interest from 114 investors, whose bids exceeded 1 billion euro, about 63% more compared to the allocated amount of 650 million euros.

Proceeds will be used to finance projects launched in priority sectors such as infrastructure, education or health.

The joint lead managers of the transaction were JP Morgan, Societe Generale, Banca IMI and Intesa Sanpaolo Bank Albania and OTP.

This is the fifth time for Albania to issue a Eurobond in the international financial markets.

Compared to the last two Eurobonds issued by Albania in 2018 and 2020, this one’s maturity is 3 years higher, as the duration is 10 years. It is the highest maturity that Albania has achieved to date in the issuance of international securities.

Albania’s first 300 million euro Eurobond was issued in 2010 and carried a coupon rate of 7.5%.
In 2015, the country issued a 450 million euro five-year Eurobond carrying a coupon of 5.75% and
in 2018 issued a 500 million euro seven-year Eurobond with a coupon of 3.50%.

In 2020, Albania’s government issued a 650 million euro seven-year Eurobond with a coupon of 3.625%.

Albania’s economy expanded 17.9% year-on-year in the second quarter of 2021, following a 5.5% rise in the previous period. It was the highest growth rate ever as the economy rebounded sharply from a record fall a year earlier due to the Covid crisis.

Both merchandise imports and exports expanded at robust rates in July–September, while tourist arrivals approached pre-pandemic levels in both July and August, before wavering somewhat in September.  On a quarterly basis, the economy expanded by 2.1%.