Bond Issue Hits All-Time High

An Israeli government bond offering in London this week was an historic success.

The government sold $2 billion of 30-year U.S.-denominated bonds at 3.375 percent, or 115 basis points over comparable U.S. Treasuries, and another $1 billion of 10-year bonds at 2.5 percent, or 68 basis points over Treasuries — the lowest-ever spreads for an Israeli international debt offering.

Demand for the issues amounted to a whopping, all-time high of $20 billion, according to the Finance Ministry, which handled the transactions.

The offering attracted more than 400 investors from 40 countries including the United States, Britain and Germany. Central banks, pension funds, insurance companies and other entities in those countries lined up for the bonds on an unprecedented scale.

The Finance Ministry’s Accountant General Rony Hizkiyahu said, “The successful issue of the bond represents a vote of confidence by the world’s large investors in the Israeli economy and indicates major demand for the Israeli government’s bonds. The amount of the bond and the low cost achieved will be an important instrument in financing government activities in the coming year and demonstrates more than anything else the strong base that the State of Israel has in global financial markets.”