Since the start of the year, Bulgaria has secured an additional BGN 700 million in debt from the domestic market, according to announcements from the Ministry of Finance and data published by the Bulgarian National Bank. Of this sum, BGN 300 million was raised through the issuance of government securities, achieving a weighted average return of 3.21 percent.

The Ministry of Finance initiated the year's first government bond issue in mid-April, offering investors 3-year treasury bonds. This initial issuance garnered BGN 200 million with a weighted average yield of 3.01 percent. Subsequently, the volume of this bond issue was expanded by an additional BGN 300 million through a recent auction, bringing its nominal value to BGN 500 million. The auction saw orders totaling BGN 356.9 million, resulting in a coverage ratio of 1.19.

Compared to similar German federal bonds, the spread reported in the auction amounted to 39 basis points. Banks emerged as the largest purchasers of government securities, acquiring 81% of the total, followed by insurance companies (9%), pension funds (3%), contract and guarantee funds (5%), and other investors (2%).

In addition to the 3-year bonds, Bulgaria also raised BGN 200 million through the issuance of 6-year bonds in mid-May, bringing the total new debt secured from the domestic market to BGN 700 million since the beginning of the year. As per the annual budget, the treasury's total new liabilities could potentially reach 11.7 billion BGN.

Notably, Bulgaria has yet to tap into the international debt markets this year.