Israel, led by Accountant General Rony Hizkiyahu, on its Independence Day completed a successful $5 billion Israel government bond issuing on Asian markets.
The 40-year bond was raised at a low 3.8% annual interest.
This was the first-ever public issue by Israel on these markets following a long-term strategic plan to expand and diversify the investor base and financing options of the State of Israel.
The issue saw high demand from some 300 high-quality investors from over 30 countries totaling over $10 billion, even though the offering was aimed primarily at Asian markets. In this move, Israel joined a limited number of countries that have issued on this market
The issuing was done following the projected rise in the government deficit as a result of the Coronavirus (COVID-19) crisis in Israel, and Accountant General Ronnie Hezekiah decided on the issuance of the State of Israel’s bonds in international markets.
The banks that served as underwriters in the issuing are Bank of America, Merrill Lynch, Deutsche Bank and Goldman Sachs.
Hezekiah stated that the successful round “targeting Asian investors for the first time in the history of the State, for a 40-year period, testifies to the confidence of the world’s largest and highest-quality investors in the robustness of the Israeli economy, especially in view of the country’s response to the Corona crisis.”
The IPO “is a testament to the country’s financial strength and its consolidated support in international markets,” he added.
The issuing will be an important pillar in the financing of government activity in the near future.
Senior Deputy Accountant General Gil Cohen added that Israel’s ability to “carry out large issues generally on international capital markets is expressed by the long-term strategy of diversifying and expanding the investor base.”
“Due to the high volatility on financial markets, the success of the issue was the direct result of the strength of the economy and the ongoing connection with investors worldwide in recent years. The issue indicates the possibility of the range of financing for the State and its ability to finance activities,” he stated.
This latest issuing follows the raising of bonds worth $5 billion at the end of March, which included $2 billion over 10 years at 2.75% annual interest, $2 billion over 30 years at 3.875% annual interest, and $1 billion over 100 years at 4.5% annual interest.