Oman in talks with regional banks for $3-4 bn to refinance loan

The Sultanate of Oman is in talks with regional banks to refinance a $2.2 billion loan it took out early last year, seeking to increase its size to between $3 billion and $4 billion, Market Screener reports citing two sources familiar with the matter.
The Gulf country subscribed for the loan in February last year and offered a 15-month tenor with a one-year extension option at the borrower’s discretion, the sources told the media.
Oman, Market Screener reports, was originally seeking up to $1 billion with last year’s loan but more than doubled its size due to strong appetite from banks.
Pricing talk for the refinancing is around 350 basis points over LIBOR, one of the sources indicated. The original loan’s all-in pricing, including fees, was between 375 and 390 basis points over LIBOR.
The Sultanate’s budget this year is expected to include a deficit accounting for 5% of gross domestic product (GDP), well within the limits of a medium-term fiscal plan it launched in 2020 to fix its heavily-indebted finances.
At the same it expects public debt to reach 75% of GDP in 2022, down from previous estimates of an 86% debt-to-GDP ratio. The country, according to the sources, may still need to tap international debt markets to fill its funding needs this year.
Fitch in December revised Oman’s outlook to “stable” from “negative” as higher oil prices and fiscal reforms improve its balance sheet, Market Screener reports.
In October, Moody’s did the same and S&P revised its outlook to “positive” from “stable”.

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