Kyrgyzstan repaid an old debt and took out a new one at a higher interest rate

Kyrgyzstan's domestic debt in government bonds on the National Bank's trading platform exceeded 290 billion KGS. These figures were published by the regulator on 6 October.

Compared to the beginning of the month, the debt decreased by 108.8 million KGS. This happened because the Ministry of Finance fully redeemed the five-year bonds issued back in October 2020. At that time, they planned to borrow 700 million KGS, but investors bought only 242.5 million worth of securities. Now this debt has been fully repaid. The bonds were issued at 10.91% per annum with a coupon of 6%.

However, on 3 October, the Ministry of Finance re-entered the market and borrowed 133.69 million KGS in three-year bonds. The plan was to raise 800 million, but demand was lower. The new securities cost the budget more, with a yield of 12.86% and a coupon of 5%.

In addition, since May 2023, the Ministry of Finance has been placing two-year bonds and 12-month promissory notes on the Kyrgyz Stock Exchange. Currently, there are 11.2 billion KGS in circulation, of which 8.2 billion are bonds.

As a result, the total domestic debt of the republic exceeded 300 billion KGS.