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VILNIUS, Jun 15, BNS - Lithuania on Monday raised 500 million euros through a Eurobond issue on international markets. The issue, which matures in 2014, carries an annual coupon of 9.375 percent, the Finance Ministry said.

"The successful placement of our securities issue in foreign markets shows investors' confidence in Lithuania and their approval of the measures that are being implemented by the country's government," Finance Minister Algirdas Semeta said in a press release. The Finance Ministry said that yields on Lithuania's Eurobonds maturing in 2016 in the secondary market ranged between 9.2 percent and 9.8 percent, but only small transactions are concluded at this price. It said a higher yield than those quoted in the secondary market had to be offered in order to attract larger investors.

"The situation in the financial markets is not stable yet and yields sought by investors remain at relatively high levels, but the very fact of the Eurobond placement is a very positive sign, both for us and for other countries in Central and Eastern Europe," Semeta said. "This is a much-needed injection of new money into the Lithuanian economy," he said.

The international ratings agency Fitch Ratings on Monday assigned the government's new Eurobond a BBB rating. The rating is in line with Lithuania's BBB long-term foreign currency rating, which was issued in April with a negative outlook. The deal was lead-managed by Citigroup Global Markets, Credit Suisse Securities and The Royal Bank of Scotland. DnB Nord Bankas handled the Eurobond placement in Lithuania, Latvia and Estonia. Lithuania last year shelved plans to reopen a 10-year Eurobond placed in 2007 for an additional 400 million euros. This would have increased the size of the issue to a billion euros.