By carrying out this debt swap, Portugal tries to ease the reimbursements foreseen for the years 2022 and 2024, throwing this responsibility to a later date.
The Portuguese Treasury postponed the repayment of €983 million in Treasury Bonds (OT) to seven and 13 years from now, in a debt swap operation. The Treasury and Public Debt Management Agency (IGCP) repurchased, in exchange, the same amount in securities maturing in 2022 and 2024 to extend the repayment periods.
According to the IGCP, it bought €501 million in OT-2.2%-17Oct22 at 104.123% and €482 million in OT-5.65%-15Feb24 at 117.343%. In this exchange operation, Portugal sold €671 million in OT-2.125%-17Oct28 at 115.15% and €482 million in OT-2.25%-18Apr34 at 119.90%
With the debt swap, the debt agency led by Cristina Casalinho is trying to ease the repayments foreseen for the years 2022 and 2024, putting the responsibility of assuming this repayment to a later date (2028 and 2034). The IGCP is trying to ease the repayments scheduled for these years at a time of favourable financing conditions.
The IGCP has taken advantage of low financing costs to carry out these debt swap operations that allow the country to smooth payments to markets in the coming years and avoid the accumulation of repayments.