Pakistan's three Eurobonds trade at over $1 premium for first time in years
'Pakistan's three Eurobonds are trading at premium for the first time after several years,' State Bank of Pakistan (SBP) Governor Jameel Ahmad said while speaking at the monetary policy press conference on Wednesday.
SBP keeps policy rate unchanged at 11%
The three bonds include the two maturing in September 2025 and April 2026, he said, recalling Pakistan's Eurobonds were trading 'at deep discount – at one-third of their issue price at 37-38 cents in 2023'.
Arif Habib Limited, Head of Research, Sana Tawfik, added the Eurobonds maturing in September 2025 and April 2026 closed Wednesday's trade at 100.28 cents and 100.05 cents, respectively, in the international market. The third bond, maturing in January 2029, closed the day trade at 100.74 cents.
There are six Pakistan's Eurobonds trading in global capital markets. The total issuance size of the bonds sum at $6.8 billion. They are maturing between September 2025 and April 2051.
SBP governor Ahmad said the country's global bonds had revived after two international credit rating agencies upgraded Pakistan's rating to 'B-' from 'CCC+' along with a stable outlook.
He said the boost in global investors' confidence - exhibited through the rising Eurobonds - was achieved in the wake of repayment of foreign debt and interest payments on the debt on time and a notable growth in foreign exchange reserves to $14.5 billion in FY25 compared to $9.4 billion in the prior year.
Besides, the return of stability in the domestic economy and rupee-dollar exchange rate, and a jump in inflows of workers' remittances to record high at $38.3 billion in FY25 compared to $32.3 billion in FY24 also played pivotal roles.
10-year Eurobond: $1bn repayment made despite dearth of forex
Ahmad said Pakistan would repay a total of $1.8 billion to global investors against the maturity of two Eurobonds falling in the current fiscal year 2025-26. The maturity of the two bonds and increase in the country's credit rating may allow Pakistan to raise new debt from global capital markets through selling new Eurobonds in future.
Pakistan to repay a net $10bn in FY26
SBP governor said Pakistan was scheduled to repay $25.9 billion, including rollovers, in FY26.
Giving a breakup, he said, the expected rollovers amounted to $16 billion in the current fiscal year 2025-26.
However, the country has to pay a net $10 billion over the year. This includes repayment of commercial loans at $3.75 billion and interest payment on the overall debt at $4 billion over the year.
Pakistan's overall foreign debt has remained stagnant at around $100 billion for the past three years, suggesting the new borrowing was purely being utilised to repay the maturing debt, Ahmad said.
Earlier, the debt had surged by on an average $6 billion a year to $100 billion in the seven years duration.
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