Following the massive success of the one-year state bonds issued in September this year, Belgium's Federal Government will again issue one-year state bonds in 2024, confirmed director of the Debt Agency Jean Deboutte on Thursday.
When exactly the bonds will be issued is not yet clear, but in principle, it could be four times a year (March, June, September and December). The Debt Agency aims to raise €13.5 billion with the one-year state bonds next year.
Whether the issue will also be at reduced withholding tax – 15% instead of 30%, as was the case for Federal Finance Minister Vincent Van Peteghem's "special" one-year state bonds – is not yet clear. The government have until 30 June to make a decision, but Deboutte "assumes they will take advantage of that."
This means that next year, the one-year state bond will also remain part of the Treasury's package of financing resources. The "special" state bonds issued this September (with an effective interest of 2.81% after taxes) were an immense success as people in Belgium subscribed for €21.9 billion.
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The Debt Agency estimated that next year the total gross financing needs of the Federal Government will be €52.92 billion, based on the new Treasury financing plan – an increase of €5.62 billion compared to this year.
In practice, €21.48 billion is needed for net financing and €29.27 billion to repay debt. The agency also plans to buy back state bonds for €1.5 billion, and the execution of 'puts and calls' on certain instruments could potentially lead to financing needs of €0.67 billion.
Additionally, it will further be financed by issuing €41 billion of OLOs (medium, long or very long-term state bonds, mainly aimed at professional investors), €2 billion through other financing instruments and €2 billion through state bonds with maturities of 3, 5, 8 or 10 years.
