Today, the Honourable Siobhan Coady, Deputy Premier and Minister of Finance, announced that the Government of Newfoundland and Labrador has placed a bond in the European capital market. This is the first transaction with the London Stock Exchange since the launch of the European borrowing program which provided an option to issue bonds beyond the existing domestic Canadian market.

The European borrowing program has diversified the province’s investor base, broadened the reach to international markets, and provided an opportunity to lower borrowing costs. In this case, the placement resulted in a cost savings of approximately $450,000 or five basis points versus what may have been achieved in the domestic market.

This first transaction was placed on October 4, 2024, at a size of 50 million euros (75 million Canadian dollars). The yield is 3.067 per cent and is due December 4, 2034. A sinking fund is attached for repayment to the investor when due.

The Provincial Government worked with RBC Capital Markets to swap the proceeds from euros to Canadian dollars. Doing so provided greater certainty from a cash flow and exchange rate perspective.

A dedicated capital markets team within the Department of Finance monitors markets daily for borrowing opportunities that provide the lowest cost to the province. The maximum amount of all notes outstanding through the European borrowing program is Euro 1 billion (or its equivalent in other currencies). More information about government’s borrowing program is available here.

Quotes
“We said we would only issue bonds in Europe if it was beneficial for the province to do so. We have met this objective. We have broadened our base of investors and consequently brought borrowing costs down by almost a half million dollars in this one placement. This work is all part of our financial management plan towards a stronger, smarter, self-sufficient, sustainable province.”
Honourable Siobhan Coady
Deputy Premier and Minister of Finance

“We are delighted to welcome the first EUR market transaction issued by the Government of Newfoundland and Labrador to the London Stock Exchange. This milestone transaction is not only a positive development for capital markets in the province, but also highlights our commitment to supporting governments across the world to raise capital from a diverse set of global investors and channel funding to economic, environmental, and social development.”
Dame Julia Hoggett
CEO, London Stock Exchange plc

-30-

Learn more
Newfoundland and Labrador Launches European Borrowing Program at London Stock Exchange

Ministerial Statement – Minister Coady Highlights Responsible Management of the Province’s Finances

DBRS Morningstar Upgrades Province’s Credit Rating

Provincial Economy Performing Well Year-to-Date; Stable Outlook Affirmed by Credit Rating Agencies

Follow us on X @GovNL

Like us on Facebook