Bulgaria has nominated Citi, JP Morgan Chase, BNP Paribas, and Unicredit to manage the new government bond issue, worth more than 2 billion EUR (2.17 billion USD).

However, the poorest EU member state, which is also one of the countries with the lowest debt, has to finance a fiscal gap equal to 3% of gross domestic product this year and allocate liquidity buffers to bear the economic the effects of the coronavirus pandemic.

Bulgaria needs additional financing of 4.5 Billion BGN (2.50 Billion USD) this year and updates its budget to raise up to 10 billion BGN (5.5 billion GBP) new debt.

“Bulgaria has nominated four banks to lead a new bond issue, the same ones that managed its last global bond sale in 2016”, said one source, who wished to remain anonymous. “The bond sale may take place next month and may amount to over 2 billion EUR so far, but the size, maturity, and timing will depend on market conditions”, adds another source familiar with the plan.

The Bulgarian Treasury Department declined to comment.

Earlier today, Finance Minister Vladislav Goranov said that increase of the ceiling on new sovereign debt aims to ensure that Bulgaria can enter the markets when conditions are favorable and be prepared for the worse-than-expected effects of the crisis.

“We are preparing to take on new debt. I prefer to have sufficient liquidity buffers in the budget so that we can be sure that all costs and, in particular, health care costs, people’s pensions, the army, police and teachers are guaranteed”, noted Vladislav Goranov.

Bulgaria, which hopes to join the eurozone “waiting room” this spring, has already issued bonds worth 1.2 billion BGN on the local market since January. Bulgaria plans to sell another 200 million BGN in five-year government securities on April 27.

The rating agencies S&P and Fitch give BBB investment rating to Bulgaria with a positive outlook and announced that joining the Eurozone waiting room could lead to a new improvement in their rating.