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Jordan has completed preparations to issue a $1bn sovereign bond by 23 June, a source at the Ministry of Finance has confirmed this week. The bond will be managed by Citibank and J.P. Morgan and is expected to carry a fixed interest of 2.5% for five years, following which it will be repayable in full.
The bond will be guaranteed by the US government, as per a loan guarantee agreement signed in early May between the US and Jordan, securing both principal and interest. This is the second loan guarantee agreement extended by the US to Jordan, after the first one signed in August 2013 (MEES, 23 August 2013). The first loan guarantee covered a seven-year $1.25bn bond which closed in October and carried a six-month coupon of 2.503%. The loan is repayable in one installment in 2020 (MEES, 1 November 2013). (CONTINUED - 350 WORDS)