Last week, the government sold $1.5 billion of notes in a private placement market. The coupon rate of the notes is 6.375 percent and the yield is 6.617 percent. The maturity date of the notes is March 24, 2021.

Funds obtained by selling the notes will be used to settle debts due for payment in the coming period, and to fill budget gaps, the ministry officials said.

More than 300 investors sought to subscribe to Croatian bonds, the ministry officials said, adding that the latest notes were issued in a not so favourable situation, with the United States still under the impact of the recent earthquake and tsunami disaster in Japan.

Without the Japan disaster the situation in the financial market might have been less one of uncertainty and the price of the bond issue might have been better, but despite these unfavourable circumstances, we have managed to negotiate a price that is better than the one of the previous government bond issue on the US market, the officials said.

Croatia came to the US market unburdened with concerns about the payment of a ten-year Euro-bond issued in 2001 since on March 14 it paid in full EUR 800,625,000 for the matured bond, including the principal amount of EUR 750,000,000 and interest amounting to EUR 50,625,000.

The funds were secured through budget savings made in 2010 and short-term loans taken from domestic and foreign banks in February this year, the Ministry said.

According to information presented today, budget savings made last year amount to US $500 million, of which some 150 million has been spent, leaving around 350 million available.

This year, the Finance Ministry plans to issue a Euro-bond in the European market and a bond in the domestic market.

The state's funding needs this year amount to some HRK 27 billion, to be obtained partly through savings made last year, by taking the already agreed loans from international financial institutions (in the amount of EUR 300 million), and through the already issued bonds and announced bond issues.