Portugal bailout bond deal sold to central banks

27 May 2011

The European Union has been aided in the sale of its second multi-billion euro bond deal of the week aimed at raising funds for the Portuguese bailout by demand from central banks in Asia, the Americas and the Middle East.

These lenders, as well as other official institutions, were among the biggest buyers of the €4.75 billion ($6.78 billion) five-year bond, the Wall Street Journal reports.

Going by investor type, 16 per cent of the bonds were bought by Asian investors, seven per cent went to the Middle East and five per cent were snapped up by the Americas.

Fred Gabizon, head of European Monetary Union Debt Capital Markets at HSBC, commented: "The five-year maturity is the most popular with central banks and we wanted to maximize their participation from around the world."

European finance chiefs recently approved a €78 billion bailout package for Portugal, meaning €256 billion has now been handed out in state aid to combat the sovereign debt crisis.

By Claire Archer

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