(Corrects figure in last para to 125)
BELGRADE, March 17 The European Bank for
Reconstruction and Development may tap the Serbian market later
in the year with another dinar bond to boost borrowing in the
domestic currency, the head of lender's mission in Belgrade said
The EBRD issued its first three-year, 2.5 billion dinar
($21.68 million) bond in December 2016. The maturity came with a
rate of 3-month BELIBOR -- the rate on dinar deposits
in the interbank market -- plus 0.4 percent.
Daniel Berg, EBRD director for Serbia, said that the bank
now has two projects under way that would use money from the
bond and that he hoped the first deal should be signed by the
end of March.
In December, the EBRD said it hoped 15 to 20 percent of its
lending to Serbia could eventually be in dinars. The bank has
already issued bonds and lent in local currency in a number of
countries, including Armenia, Georgia, Kazakhstan and Russia.
"What I hope ... is that those first loans will be signed
... and we'll come back to the market for additional dinar
fundraising later in the year, and I hope the next fundraising
will even be at more competitive pricing," Berg said.
"The first one (bond) is competitive enough, but I am not
sure it's going to be easy to sell that price forever."
The EBRD has so far lent 4.5 billion euros ($4.8 billion)
to Serbia where more than 70 percent of borrowing is in foreign
Berg said that the EBRD wants to boost borrowing in the
dinar as unhedged borrowers in foreign currencies can be exposed
to exchange rate risks.
"People have dinar incomes, dinar revenues and they are
borrowing in euros ... they have a risk on their balance sheet
which they are not addressing if they are borrowing in euro," he
Berg also said that the EBRD was considering working with
commercial banks to invest in Serbia's energy sector including
wind farms and environmental projects such as a Belgrade
"If you are financing a couple of them then you are talking
about 100 to 125 million euros from the EBRD," he said.
(1 = 115.3100 Serbian dinars)
($1 = 0.9307 euros)
(Reporting by Aleksandar Vasovic; Editing by Jeremy Gaunt)