February 01, 2007	Thursday	Muharram 12, 1428

KARACHI, Jan 31: Pakistan plans to issue a sovereign bond by end-March and a mandate to manage the transaction will be awarded in a couple of weeks, a senior government advisor said on Wednesday.

The planned issue will be Pakistan's fourth foray into the international debt market since 2004, when it returned to the arena for the first time after being under economic sanctions for conducting nuclear tests in mid-1998.

Last year, Pakistan sold $800 million in a dual tranche sovereign bond, comprising $500 million in a 10-year issue and $300 million in 30-year paper.

“We hope to complete the transaction in this quarter,” said Salman Shah, adviser on Finance to Prime Minister Shaukat Aziz.

“We are currently evaluating it, and several banks have completed their presentations, while a few more are in the pipeline,” Shah told Reuters by telephone.

“We will award the mandate as soon as we are done with the evaluations, and it will probably take a couple of weeks.” Shah did not give any details on the type and size of the transaction, but a banking source said the government may opt for a 144-A type paper, referring to a clause which makes the securities eligible for purchase and trade by US investors.

“Though a decision is yet to be taken, I think they will go for a 144-A, and the size would be close to $1 billion,” said the source, whose bank is competing for the mandate.

Analysts and bankers said the government is likely to test a different point in the yield curve this time around, and thus it may go for a 15- or 20-year issue.

In 2004, Pakistan issued a $500 million, five-year eurobond, while in 2005, it floated a $600 million Islamic bond, also for a five-year term.—Reuters