Jordan completes third US-guaranteed bond issue

AMMAN — Jordan has issued bonds worth $1.5 billion on the international market, $1 billion of which is for a seven-year term, due in 2022, and the $0.5 billion for a 10-year term, due in 2025, Finance Minister Umayya Toukan announced Friday.

The interest rate for the seven-year term bonds is 2.58 per cent, while the interest rate for the 10-year bonds stands at 3 per cent, Toukan said, noting that the interest for each issue is paid every six months until the maturity date.

The minister also noted that the underwriting applications for these bonds reached around $4.9 billion, or 326 per cent of the issue value, with the entire issue being sold to senior international investors, the Jordan News Agency, Petra, reported.

The government followed this approach to borrowing to diversify its funding resources and maturity periods, and to balance between domestic and external borrowing, benefiting from the US guarantee in securing low-interest loans, Toukan highlighted.

He also expressed the Kingdom's appreciation for the US government's continuous support and all the institutions that contributed to issuing the bonds.

Vice Governor of the Central Bank of Jordan Adel Sharkas and a representative from USAID also attended the issuance ceremony, according to Petra.

This issuance is the third international market bond guaranteed by the US government. On June 26, 2014, Jordan closed its offering of a $1 billion, five-year sovereign bond issuance that was supported by a 100 per cent guarantee of the repayment of principal and interest by the US. 

On October 31, 2013, the Kingdom also issued a $1.25 billion sovereign bond on international markets.