THE ROADSHOW WAS A SUCCESS: The Eurobonds of the Ministry were oversubscribed five times

Romania successfully borrowed one billion Euros through its 5-year Eurobonds issue, which offers a coupon of 5% and a total yield of 5.17% per annum, even though at this yield, demand from foreign investors reached EUR 4.9 billion.

"The total book reached 4.9 billion Euros, almost five times the initial offer. The 5% coupon is an absolute record for Romania and is a good price for the bonds issues in the region. The yield is 5.17% a year", Bogdan Drăgoi, secretary of State in the Ministry of Finance told Reuters.

The yield paid to private investors is only 1.5% higher than the interest rate of the loan taken from the IMF, with the spread being almost two points compared to the interest rate paid for the first tranche of the loan taken from the EU.

Daniel Dăianu, former minister of Finance, said that he was expecting the issue to be oversubscribed: "I"m not surprised at the results, the yield is very good for foreign investors, Romania does not have an excessive public debt, and the Central Bank has consistent reserves, which indicates that Romania has overcome the critical moments in the beginning of 2009".

Also, in Dăianu"s opinion, the great demand comes from the fact that the interest rate offered is attractive, as Romania has the agreement with the IMF behind it.

In June 2008, Romania raised 750 million Euros from a 10-year Eurobonds issue, with a coupon of 6.5%.

"Generally, the yields on the domestic market are greater than the ones offered to foreign investors", Mr. Dăianu said.

Lucian Anghel, chief-economist of BCR, said that the great demand is due to the positive outlook Romanians have on the recovery of the Romanian economy, an opinion backed by Lucian Croitoru, one of the advisors of the governor of the NBR, Mugur Isărescu. Mr. Croitoru said that the money coming from the Eurobonds issue will definitely go to the Treasury, but once it gets there, there are many possible uses for it.

"The Ministry has several alternatives, either it could use the money to make various payments where needed, or it could keep it to strengthen its position for any future domestic auctions", Mr. Croitoru said.

The successful sale of the Eurobonds comes one day after ratings firm Standard & Poor"s (S&P) revised Romania"s long term outlook from "negative" to "stable", for loans denominated in lei as well as in Euros, thanks to the sustained budget reform and to the fact that the Government will most likely be able to continue to abide by its agreements with the international financial authorities.

Ratings firm Fitch recently improved its rating, from "negative" to "stable", and confirmed its ratings for long term loans denominated in foreign currencies and in lei to "BB plus", and "BBB minus", respectively.