International banks asked to manage Czech euro bonds

More than twenty international banks have been asked to submit bids to lead manage the Czech Republic's debut sovereign euro bond issue, Deputy Finance Minister Eduard Janota told Reuters news agency on Thursday. The Czech Republic is looking to tap international markets for about one billion euros through a 10-year bond issue in June, about a month after it joins the European Union. According to Mr Janota, the ministry will make a short list and choose one or two lead managers by the end of this month at the latest. The Czech euro bond offering is expected to set a benchmark for sovereign debt of the country, which - unlike its central European peers - has no outstanding sovereign foreign bonds. Apart from this, the finance ministry also wants to open up a new borrowing channel and ease pressure on the domestic market, increasingly saturated by fast growing state debt. Czech government debt accounted for 37.6 percent of gross domestic product last year, under EU criteria, and is seen rising further in the years to come due to fiscal deficits.