Bahrain Plans to Sell Dollar Bonds to Plug Budget Deficit - Bloomberg

Bahrain Plans to Sell Dollar Bonds to Plug Budget Deficit - Bloomberg

Bahrain started marketing a three-tranche dollar bond to help plug one of the widest deficits in the region.

The Gulf Arab kingdom is selling benchmark-size seven-year debt, 12-year securities and/or notes maturing in 30 years, according to a person familiar with the matter, who’s not authorized to speak publicly and asked not to be identified. Benchmark typically means the equivalent of at least $500 million.

Despite a $10 billion bailout package pledged by its wealthier neighbors in 2018, Bahrain’s public finances have been under strain from the twin shock of the pandemic and lower oil prices. The International Monetary Fund projects Bahrain’s budget deficit to be at about 9.2% of gross domestic product this year.

“They are coming because they need to continue to fund fiscal deficits,” said Abdul Kadir Hussain, the Dubai-based head of fixed-income asset management at Arqaam Capital. “There is appetite for non-investment grade credit as people are chasing yield.”