Government Hires Banks Prior To Bond Issue

July 22, 2013

[Updated] The Bermuda Government has “hired banks to arrange investor meetings in the United States and Europe ahead of a potential international bond issue,” according to a report from the Reuters news agency.

“The sovereign, rated Aa3/AA-/AA-, has mandated Barclays and JP Morgan to arrange the meetings, which will take place in New York on Wednesday, Boston on Thursday, Los Angeles on Friday and will wrap up in London the following Monday, July 29,” reported Reuters.

The news agency reports that Finance Minister Bob Richards, Finance Secretary Anthony Manders and Director of International Business Travis Gilberts will attend the roadshow.

Last month Minister Richards said the next bond issue, expected this summer, is anticipated to cover three years of operating deficits, and the government will borrow in the range of $400-$800 million.

Minister Richards speaking on the bond issue last month:

Minister Richards said that borrowing three years worth of deficits now will save tens of millions of dollars in financing costs.”

“There has never been multi-year financing, until now,” said the Minister last month. “The next bond issue, expected this summer, is anticipated to cover three years’ government operating deficits. Therefore the amount raised will be in the range of $400-$800 million.

“We judge that we are in the last phase of the ultra- low US$ interest rate cycle. As the US economy gains strength, US$ interest rates, and therefore bond yields and borrowing costs, are highly likely to rise.”

The Finance Ministry has not yet responded to our request for comment, however we will update as able.

Update 5.47pm: A Ministry spokesperson said, “As it does from time to time, The Bermuda Government will be meeting international investors to provide an update on economic/fiscal developments in the Country, and also as part of its process of evaluating market conditions and potential funding opportunities to address its borrowing requirement. Due to Restrictions on Publicity for this process the Ministry is unable to make any further comments.”

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  1. Reuters: Bermuda Plans 10-Year US Dollar Bond | | July 30, 2013
  1. Vote for Me says:

    Let me be the first to ask??

    What is the 5 year plan for our national finances? If we expect deficits totalling $800m for the next 3 years, what about years 4, 5 and beyond? If we borrow $800m now, we will not be able to borrow anymore after that.

    Is anyone listening? 2017 will be here sooner than we realise.

  2. Phil the brother???? says:

    After the last time the island got ^$^&%^&( is there any wonder that HSBC isn’t the lead on this?

  3. First Cox now Uncle Bob says:


    All the arrangement fees go overseas to Barclays and JP Morgan, good going Minister Richards, I am sure HSBC, Butterfield Bank, Capital G and BCB have NO EXPERIENCE in acting as Lead Arranger?

    When will Bermudians really believe in Bermudians? Does Minister Richards understand how the ILS market works and that local companies are issuing high risk paper, that is more “at risk” than our Sovereign Debt? I’m an OBA supporter but this is not the way to go, HSBC or BNTB should have been lead with their choice of who they wanted to work with in the international markets to get institutional investors to buy our paper, hopefully the arrangement fees on this deal will BE PUBLISHED in our local media.

    Minister Richards, please tell us its not the same advisors in the Ministry that you are also using?

  4. Politically Incorrect says:

    I am sure HSBC, Butterfield Bank, Capital G and BCB have NO EXPERIENCE in acting as Lead Arranger?

    Apart from HSBC you are correct.