14 Jul 2010

Greek bond sale held

7:51 am on 14 July 2010

Greece has successfully sold government bonds in its first attempt since a loan bail-out by the EU-IMF was arranged in early May.

It had sought to raise 1.25 billion euros ($US1.58 billion), but the offer was oversubscribed, with bids totalling 3.6 billion euros.

Greece must repay the bonds after six months, with a return rate of 4.65%, which is lower than IMF loans.

The bail-out package is worth 110 billion euros over three years. The payments are on condition that Greece slashes public spending and boosts tax revenue.

However, analysts said the sale was not a good indication of how much faith investors had in Greece's long-term prospects, because the bonds had a very short maturity.

Greece earlier abandoned plans to sell 12-month bonds.