Croatia Plans to Raise Billion Euro From Bonds

Croatia plans to raise cash by selling an additional billion euro of state bonds.

The economy ministry has commissioned four top banks - Barclays, Erste Group, JPMorgan and UniCredit - to arrange the issue of this new edition of euro bonds.

The Minister of Economy, Boris Lalovac, first announced this new edition of euro state bonds back in December.

The government assessed that it was a convenient time for selling bonds, as the eurozone policy of monetary easing had lowered the value of money on European markets.

The last issue of euro state bonds was last May when around 1.25 billion euro in state bonds was raised.

Croatia's credit rating is weak. Fitch and Standard & Poor's rate it at BB, while Moody estimates it at Ba1 level, both being perceived as below the recommended level for investment. The economy has contracted sharply since 2008 and general government debt climbed to almost 34 billion euro by the end of October 2014.

However, the Croatian government hopes that investors will reward it for taking measures to close the deficit and streamline costs.