Abstract
On March 7 2020, the Lebanese government announced for the first time that Lebanon will not pay a $1.2B Eurobond due on March 9 and will seek to restructure its sovereign foreign currency debt which reached $31B in 2019. In this paper, we study the performance of the Lebanese Eurobonds Market in the first half of 2020 especially after this unprecedented move, noting that lately we notice as slight increase in the Blom Bond Index. In details; we will discuss how bondholders are affected by this decision and the reasons that might be behind this rise in bond prices. Most importantly, we will explain the mechanisms of the Credit Default Swap (CDS) market and how it affected the Eurobonds’ prices following the “Lebanese Republic Credit Event Auction”
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Study of Lebanon’s Eurobonds Market in H1 2020 Amid Government Default Decision