Has EFSF tapped out 2037s for the last time?
The European Financial Stability Facility (EFSF) may have tapped one of its outstanding issues for the last time when it issued a further €1bn of its 3.375% 2037s on Wednesday. The bail-out borrower is looking to issue one more benchmark as soon as next week (see separate story) but Cyprus’s request for a bail-out could hamper the potential liquidity of the borrower’s outstanding deals.
The EFSFs guarantee structure implies that a guarantor has to leave the facility if it receives fully fledged macroeconomic support rather than other, lighter, more flexible EFSF programmes such as primary or secondary market intervention, precautionary arrangements or bank recapitalisation.
Cypruss share of the EFSF guarantee is negligible.
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