Mongolia bond, bigger than forex reserves, gets huge bid

29 Nov 2012

Mongolia made an explosive debut in the international bond market this week, raising $1.5bn from a deal that was the biggest Asian sovereign debut in more than a decade. But more eye-catching for bankers was the deal’s size relative to the country’s economy — it was equivalent to 15% of Mongolia’s projected GDP for this year, and was greater than its entire foreign exchange reserves.

The size of the deal relative to the country’s economy made it unique in the capital market, said debt bankers, none of whom could remember such a huge increase in government debt-to-GDP from a single bond. Mongolia’s nominal GDP was $8.7bn in 2011, according to the International Monetary ...

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