Bloomberg News

Poland Sells 12-Year Bonds in Euros at Record-Low Yield

November 19, 2012

Poland sold 750 million euros ($957 million) of 12-year euro-denominated notes today to benefit from record-low yields, driven down by liquidity provided by central banks seeking to revive global economic growth.

The bonds maturing in July 2024 were priced to yield 135 basis points more than euro mid-swaps, compared with a 143 basis-point spread when it sold 1.75 billion euros of the same notes on Oct. 2, according to a person familiar with the offering, who declined to be identified because the information isn’t public. Commerzbank AG, HSBC Holdings Plc, ING Groep NV and Societe Generale CIB arranged the sale, the Finance Ministry said on its website.

“We decided to tap the euro market to take advantage of yields at historic lows,” Deputy Finance Minister Wojciech Kowalczyk said in an e-mailed statement. “This will be our last public sale of bonds on foreign markets this year.”

The lure of record-low borrowing costs has pushed Poland to issue the equivalent of $12.1 billion of notes in foreign currencies in 2012, trailing only China’s $30.2 billion among emerging-market peers, according to data compiled by Bloomberg. Investors are seeking higher returns in developing nations as policy makers from the U.S. Federal Reserve to the European Central Bank keep borrowing costs low to spur growth.

Euro-region economies, which buy 54 percent of Poland’s exports, contracted 0.6 percent in the third quarter. Expansion in the European Union’s biggest eastern economy will slow to 1.5 percent next year, according to central bank forecasts, the least in a decade.

“Clearly, the Poles are eager to take advantage of very liquid and cheap financing conditions,” Timothy Ash, head of emerging-market research at Standard Bank Group Ltd in London, said in e-mailed comments today. “The longer term outlook is much more uncertain.”

To contact the reporters on this story: Selcuk Gokoluk in Istanbul at Piotr Skolimowski in Warsaw at

To contact the editor responsible for this story: Gavin Serkin at

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