Armenia has joined a select group of countries, including Canada, Sweden, and Denmark, by successfully launching a government bond swap mechanism. On December 17, the country’s stock exchange hosted the first-ever bond swap auction, marking a significant step in implementing its public debt management strategy.
According to the press service of the Armenian Stock Exchange, the auction resulted in the successful issuance of government bonds with the code AMGN36294277, totaling $12.7 million. These bonds were swapped for government bonds with the code AMGN36294251, with a total volume of $12.2 million.
The auction attracted strong investor interest, with total bids reaching $28.4 million. The weighted average yield stood at 10.48%, and the maturity date for the new bonds was set for April 29, 2027.
The Armenian government decided to implement the bond swap mechanism in April 2024. This tool aims to enhance domestic public debt management capabilities and stimulate market activity.
Experts believe that conducting bond swap auctions will improve the liquidity of government bonds and reduce refinancing risks. Additionally, it allows for the gradual removal of old or illiquid bonds from the market, replacing them with new issues.
For investors, the new mechanism offers greater flexibility in managing government bonds, facilitating more effective portfolio restructuring. The successful completion of the first bond swap auction lays the foundation for introducing new initiatives and tools, strengthening Armenia’s financial market, and expanding the country’s investment opportunities.
