The Slovenian government wants to focus on jump-starting stalled loan issuance by local banks by taking over some bad loans from state-owned lenders and making its first sale of dollar-denominated sovereign debt in the US later this year.
Recently Slovenia stoked concerns that it may become another to request an international bailout because of its debt-saddled state-owned banks. Last month two credit rating agencies downgraded Slovenian debt, roiling global markets on concerns that the region's leaders are losing their battle to contain the bloc's fiscal crisis.
"We're fighting the fight for credibility on financial markets", Janez Šušteršič, Slovenian finance minister, said. "I think they still look at us as the country that can deal with its issues and that's a status we would like to preserve."
By fixing the Slovenian banking sector and cutting its budget deficit to below 3 per cent of gross domestic product in 2013 from 3.5 per cent expected in 2012, the government aims to raise sovereign debt on more favorable terms after it canceled a €1.5 billion eurobond sale in April amid a steep rise in yields.
Slovenia's long-term bond yields have fallen just below 7 per cent in recent days, Mr Šušteršič said, and the country will return to the eurobond market if the planned sale of dollar bonds worth $1.5 billion goes well.
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© Wall Street Journal
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