June 9, 2017 / 8:23 AM / 9 months ago

Croatia gearing up for new local bond issue -sources

ZAGREB, June 9 (Reuters) - Croatia is gearing up for a local bond issue worth up to 500 million euros ($559.30 million) that is expected soon, a source at a major local bank said on Friday.

“The issue is likely to specifically target insurance groups and pension funds. Its maturity is seen at 15 years and the interest rate somewhat over three percent,” said the source who asked not to be named.

According to a government source, a fresh issue is under consideration and may be ready for early next month, while the details are expected towards end of June.

This year Croatia has already refinanced a local bond in February and an international issue in March

It also has to refinance a local bond worth 4.0 billion kuna ($603.86 million) that matures in November.

Croatia’s public debt was at 84 percent of gross domestic product at the end of the last year when the government managed to make if fall for the first time in almost a decade.

Last month Croatia exited the European Union’s excessive deficit procedure - a tool Brussels uses to impose fiscal discipline in member states - after a fiscal gap in 2016 fell to 0.8 percent of GDP from 3.4 percent a year before. ($1 = 0.8940 euros) ($1 = 6.6240 kuna) (Reporting by Igor Ilic; Editing by Tom Heneghan)

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