Tunisia plans international syndicated loan in 3Q19

15 April 2019

Tunisia plans international syndicated loan in 3Q19

 

15 April 2019 | 09:20 BST

 

The Government of Tunisia plans to raise an international syndicated loan by the third quarter this year, said two sources familiar with the situation.

 

The sovereign has sounded out appetite among banks to raise between EUR 300m and EUR 500m with a maturity between seven and 10 years, the first source familiar said.

 

The deal comes shortly after Tunisia borrowed EUR 356m from a consortium of 12 local lenders in March. That loan had a maturity of three-years and paid interest rates between 2.25% and 2.5%, according to local press reports.

 

“Tunisian banks are very liquid in euros, so this was a good way for them to use it, by funding the sovereign,” said the first source familiar. “Sovereign risk in euros is rare and attractive to them.”

 

Tunisia last tapped international capital markets with EUR 500m, 6.75% 2023 bond in October last year.

 

On other borrowing fronts, Tunisia is facing delays in the delivery of the next USD 250m instalment of its USD 2.9bn Extended Fund Facility with the International Monetary Fund (IMF).

 

In a statement from 9 April, the IMF said that the government needed more time to “fully flesh out their policy proposals in a few areas”. Tunisia's high youth unemployment is likely to prevail despite expectations of slightly higher GDP growth, the IMF said.

 

by Laura Gardner Cuesta