The Treasury announces that the amount of issuance of Malta Government Stock (MGS) for the financial year 2016 has been set not to exceed € 600 million.

Purpose of issuance

It is planned that the issuance programme of MGS for the year 2016 shall be applied to finance the Central Government borrowing requirements for 2016 including:

¨ The redemption of four (4) MGS issues amounting to € 417,770,738 which are due to mature as hereunder:

25^th March 2016                      6.65% MGS 2016 (I)              € 69,883,069              

16^th August 2016                    4.3% MGS 2016 (IV)             € 158,145,275            

26^th November 2016               4.8% MGS 2016 (II)               € 186,351,758          

Ex-Church Property Stock redeemable between 1^st January 2016 and 31^st December 2016

7% MGS 2016 (III)                € 3,390,636;              

¨ Financing of Central Government deficit estimated at €196 million;

¨ Repaying a bank loan of €56,378,732 with a commercial bank maturing in 2016; and

¨ Effecting changes in the Central Government debt portfolio, as and when required, in line with    the Government’s debt management policies.

Types of MGS issuance

The issuance programme will be covered by the issue of two different types of securities: –

¨ The conventional fixed rate MGS, and

¨ The Floating Rate MGS (FR Bond) linked to the six month Euribor.

The conventional fixed rate Malta Government Stock shall be the Treasury’s primary financial instrument by which to fund the central government borrowing requirements during the year 2016.

Alongside the conventional MGS, the Treasury is expected to offer a limited amount of the Floating Rate MGS linked to the six-month Euribor via the auction system for institutional investors.

Frequency of issuance

The Treasury intends to fund the financing requirements for 2016 over four (4) to five (5) issues. The first MGS issue is expected to be launched in February 2016. As part of its issuance strategy, the Treasury will need to retain the flexibility and capability to adapt quickly to changing market and other conditions and, where necessary, review and readjust the amount that will be allocated for each issue as well as the intervals of issuances.

Maturity and terms of issuance

The maturity structure of the 2016 MGS issues will be a mix of short and medium to long term MGS. The exact maturity and details on whether the offer will be for a new stock or a re-opening of an existing MGS will be announced one (1) to two (2) weeks prior to the opening of each issuance.

The terms and conditions of MGS issues will be published in the Government Gazette prior to the actual date of each issue.

Collective Action Clauses (CACs) in newly issued MGS

In accordance with paragraph 3 of Article 12 of the modified version of The Treaty establishing the European Stability Mechanism (ESM), all new MGSs issued on or after 1^st January 2013 will incorporate the Model Collective Action Clauses (CACs).

Treasury Bills

¨ Auctions will continue to be held on a weekly basis, typically on Tuesday of the auction week.

¨ The maturity structure of issues will include a mix of 28-day, 91-day, 182 day, 273-day and 364-day Treasury bills.

¨ The issuance is expected to focus on the 91-day and 182-day tenor.

¨ A Treasury Bill issuance calendar showing the tenor of each weekly issue/s planned for each month will be published in the Government Gazette in advance on a monthly basis.

¨ The Treasury Bills Prospectus may be viewed under the Treasury Bills section on the Treasury’s website at www.treasury.gov.mt.