Brussels, 18/03/2011 (Agence Europe) - On Thursday 17 March, the European Commission placed a €4.6 billion bond issue on behalf of the European Union, the proceeds of which will be lent to Ireland and Romania in return for their introduction of a structural adjustment programme. Ireland will receive €3.4 billion under the European Financial Stabilisation Mechanism (EFSM) and Romania €1.2 billion under the Balance of Payments (BoP) facility.
“Books were closed within less than two hours, being oversubscribed more than three times…. In terms of investor type, the banking sector and asset managers were the most important, followed by central banks”, explained the European Commission in a press release, adding: “The Commission considers that the successful placement is a sign of continued confidence in the stability measures set up by the EU for dealing with the crisis”.
This is the second EFSM transaction in support of Ireland, following the initial disbursement of €5 billion made on 12 January. The EFSM can lend up to €60 billion and has planned to raise €17.6bn in 2011 to lend on to Ireland. Romania has to date received €4.85bn from the EU. The IMF has lent Hungary €13bn in the form of bilateral loans. Along with Romania, Latvia and Hungary have also received cash from the BoP facility. (M.B./transl.fl)