ISLAMABAD: (Finance Reporter) – Pakistan has raised a record $3 billion through a dual-tranche Eurobond issuance, marking the country’s largest-ever single international capital market transaction, the Ministry of Finance said on Thursday.
The issue attracted nearly $6 billion in orders, almost twice the amount offered, reflecting strong demand from institutional investors across different regions and global markets.
The ministry said the successful transaction represents a significant step in Pakistan’s renewed access to international capital markets and demonstrates improved investor confidence in the country’s economic and credit outlook.
Details of the Transaction
The government issued $1.75 billion in a 5½-year Eurobond carrying a coupon of 7.50 percent, while another $1.25 billion 10-year Eurobond was issued at a coupon of 7.90 percent.
In total, Pakistan raised $3 billion, against global investor demand of nearly $6 billion.
The Finance Ministry said strong demand for the longer-dated 10-year bond was particularly significant, indicating that international investors are increasingly willing to provide Pakistan with longer-term financing as they reassess its macroeconomic and credit fundamentals.
The transaction is also part of Pakistan’s broader Road to Market strategy and marks the first issuance under the country’s renewed Global Medium-Term Note (GMTN) Programme following the successful launch of its inaugural Panda Bond.
Officials said the strategy goes beyond simply raising additional debt. Pakistan aims to diversify its financing sources, extend debt maturities, lower refinancing and rollover risks and, where economically beneficial, replace shorter-term and more expensive obligations with longer-duration financing.
The government has also undertaken early retirement of portions of its domestic debt ahead of maturity. According to the ministry, applying similar discipline to external borrowing is intended to improve the overall sovereign debt profile.
The Debt Management Office of the Ministry of Finance played a central role in executing the transaction.
The government also credited joint bookrunners Citi, Deutsche Bank, Emirates NBD, MUFG and Standard Chartered for managing the issuance, while acknowledging the support provided by legal advisers and other stakeholders.
The ministry said Pakistan’s economic recovery over the past three years has been accompanied by successive sovereign credit-rating upgrades and renewed access to international capital markets.
The strong order book, geographically diverse investor participation and demand for the 10-year sovereign bond were described as important market indicators of improving confidence in Pakistan’s medium- and long-term economic prospects.
However, the government acknowledged that further work remains necessary, including maintaining fiscal discipline, pursuing structural reforms and improving exports, investment and productivity.
The latest issuance follows Pakistan’s $500 million three-year Eurobond launched in April under the GMTN Programme. Strong demand subsequently allowed the government to increase the issue to $750 million through a $250 million green-shoe option. That bond matures in April 2029.
Pakistan also repaid a $1.4 billion Eurobond in April, allowing the country to re-establish a pricing benchmark in international debt markets after several years of relying more heavily on multilateral, bilateral and commercial financing.
The Finance Ministry described the latest $3 billion transaction as a landmark development in Pakistan’s progression from economic stabilisation toward sustainable growth.
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