Bermuda Government has issued $665 million of senior notes as it repositions the island’s debt.

Consequently, the island’s overall debt load has increased by $188.9 million, but in the process the Government has locked in a 3.717 per cent rate on its new 10-year securities.

A Government team travelled to London, New York, Boston, Los Angeles and Germany, meeting with 34 investor groups, to attract interest in the new senior notes.

The offering proved attractive to investors, and was two-and-a-half times oversubscribed.

Bob Richards, Minister of Finance, said it had been an opportunity to finance a $199.4 million budget deficit in the current financial year, refinance a $200 million, 5 per cent loan facility due next year, and repurchase $276 million of higher-coupon bonds that were due to mature in 2020.

The refinancing of the loan facility will result in interest savings of $1.8 million.

Mr Richards: “It is important to note that although the Government issued a total of $665 million in new bonds, the total amount of debt held by the Government will only increase by $188.9 million.”

As part of the restructuring of the island’s debt, Government this month accepted for early redemption $276 million of its 5.603 per cent senior notes, which had been due in 2020. This will bring annual interest savings of about $3.8 million.

Government’s new 3.717 per cent senior notes, which will mature in January 2027, have been admitted for listing on the Bermuda Stock Exchange.