On February 15, 2024, the Ministry of Finance carried out the second transaction on the international financial markets, by launching two tranches of bonds with maturities of 7 years and 12 years, denominated in EUR. The 12-year tranche represented Romania’s inaugural green bond issue.

The total value of the bond issue of EUR 4 billion had a final subscription of more than EUR 14.8 billion with the participation of a total number of more than 250 investors. The issue attracted impressive interest from investors, with their orders exceeding EUR 17 billion during the transaction.

The 12-year maturity represents the largest EUR-denominated green tranche issued by an emerging market issuer (ESG debt instruments) to date. The deal also represents the largest EUR-denominated green bond issue by an emerging market issuer. Finally, the issue was the largest transaction on Romania’s international financial markets, and the final subscription obtained was the largest so far for our country.

The volume attracted for the tranche with a maturity of 7 years is EUR 2 billion, at a yield of 5.394 percent and an interest rate of 5.375 percent per year, and for the green tranche with a maturity of 12 years, the volume of EUR 2 billion was attracted, at yield of 5.734 percent and an interest rate of 5.625 percent per year. The funds obtained from this issue were settled on February 22, 2024.

In the process of developing the Green Bonds Framework, the Ministry of Finance benefited from technical assistance from the World Bank.

The bond issue, launched on February 15, is part of the external financing plan for the year 2024, through which the Ministry of Finance aims to ensure the financing needs from foreign markets for this year, as well as to strengthen the financial reserve in foreign currency at the disposal of the State Treasury .

The bond issue was oversubscribed more than 3 times for the 7-year tranche, respectively more than 4 times for the 12-year green tranche. At the same time, the issue benefited from a very diversified investment base both geographically and from the perspective of the types of investors.

In terms of the geographical distribution of investors, for the 7-year maturity, it was as follows: UK and Ireland 46 percent, Rest of Europe 22 percent, USA 13 percent, CEE 7 percent, Germany, Austria and Switzerland 5 percent, Romania 4  percent and the rest of the states 3 percent.

For the 12-year maturity, the geographical distribution of investors was as follows: Great Britain and Ireland 48 percent, rest of Europe 19 percent, Romania 11 percent, USA 9 percent, CEE 8 percent, Germany, Austria and Switzerland 3 percent, and the rest of the states 2  percent.

The transaction was brokered by Citigroup Global Markets Europe AG, Este Group Bank AG, HSBC Continental Europe, J.P. Morgan SE and Société Générale, Citigroup and HSBC also playing the role of structuring banks for the green tranche.