Croatia's Finance Ministry sold a new 7-year treasury bond worth €1.445 billion with a currency clause and an interest rate of 0.75 percent, the ministry said in a press release on Monday.

The latest bond issue has “exceptionally favourable borrowing terms considering the current challenging market circumstances,” the ministry added.

The funds raised with the latest bond issue will be used to finance government programmes designed to offset the consequences of the Covid-19 pandemic in the country.

At last week’s cabinet meeting Finance Minister Zdravko Maric said that since the beginning of the year, the ministry had arranged with banks an additional 6.1 billion kuna (€805 million) in liquidity and rescheduled treasury bills in the amount of 2.5 billion kuna (€330 million).

He then announced Monday’s bond transaction on the domestic market, saying that after the completion of the transaction more than one third of Croatia’s financing needs would have been met on the domestic market.

At the end of February, the ministry had issued a 15 billion kuna bond (€2 billion) in three tranches on the domestic market, the majority of which was used to reschedule existing bonds, while the expected interest savings were estimated at 716 million kuna (€94 million) a year.

(€1 = 7.57 kuna)