Treasury raises $400 million from Asia

China's sovereign investment fund, CIC, and Singapore's sovereign investment fund, Temasek, are among Asia's leading government funds.

By YAEL GRUNTMAN
July 5, 2011 22:27
1 minute read.
Yuval Steinitz

Yuval Steinitz 311. (photo credit: Ariel Jerozolimski [file[)

 
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The Accountant General’s Office implemented a $400 million, one-year, private offering to one of the world’s largest Asian government funds on Tuesday.

The offering was made as part of the Government’s European Medium Term Note shelf prospectus plan. Goldman Sachs, which is currently serving as the head market maker for Israel government bonds, was the underwriter.

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“The current offering was implemented at the request of the Asian investor, who is considered a strategic global investor in capital markets. This will be its first investment in Israeli government bonds,” the Finance Ministry said.

China's sovereign investment fund, CIC, and Singapore's sovereign investment fund, Temasek, are among Asia's leading government funds.

The fund raising was implemented at a one-year dollar interest rate of 1.599 percent.

In shekel terms, this is very low for fund raising costs. The government's financing cost in shekels is lower than the short term securities' yield for the same period by about 0.3%.

Finance Minister Yuval Steinitz said his ministry, “views the penetration of new markets as extremely important, and in particular the Asian market that is developing so quickly. Israel's exposure to Asian financial markets opens the door for Israeli companies interested in conducting commercial activity with Asian countries. The fact that these types of investors chose to do this deal with the State of Israel is another vote of confidence in the strength of Israel's economy.”

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