Spain’s Catalonia to launch 2.7 bln euro retail bond

MADRID, April 1 (Reuters) – Spain’s indebted northeastern
region of Catalonia plans to launch a 2.7 billion euro retail
bond, probably next week, a spokesman from the Catalan
government said on Friday.

The spokesman added that the bond would have maturities for
one year, paying 4.25 percent, and for two years, paying 4.75
percent.

The two-year tranche will be capped at 1.066 billion
euros.

Investors are closely watching the finances of Spain’s
regions closely for signs they may be unable to cut spending
and help the central government meet its EU agreed deficit
targets.

Catalan savings banks La Caixa, Catalunya Caixa and Unnim,
along with Spanish bank Banco Sabadell (SABE.MC: Quote, Profile, Research) and Barclays
(BARC.L: Quote, Profile, Research) will manage the placement.

Catalonia was one of nine Spanish regions which missed
their deficit targets last year and needs to refinance around
4.3 billion euros this year, according to Reuters service IFR.

Catalonia is expecting approval to refinance the rest of
its debt in the next few months.

In mid-March Catalonia’s new Economy Secretary Albert
Carreras told Reuters the region was paying too much to
refinance its debt and would look to carry out roadshows
overseas to spur interest in the region. [ID:nLDE72D1D1]

Catalonia accounts for about one-fifth of Spain’s gross
domestic product and is home to its largest industrial centre.
(Reporting by Martin Roberts; Editing by Kenneth Barry)

Spain’s Catalonia to launch 2.7 bln euro retail bond