The „Black Rock“ investment fund, did not turn Serbian finances into black as it is written on social networks and as the deputy of the „Ujedinjeni“ parliamentary club Vladeta Janković stated the other day. He asked the Prime Minister of Serbia, Ana Brnabić, to explain or deny the rumors that the international global fund „Black Rock“ in Belgrade took over the external debt of 34 billion euros. The Prime Minister denied it.
Who is “Black Rock”? It is about one of the world’s largest investment funds, which, according to data from their website, manages assets of nine thousand billion dollars. How much that value is can be seen from the fact that China’s gross domestic product in 2021 was 18 thousand billion dollars, and the US slightly higher than 23 thousand billion dollars. “Black Rock” in the first quarter of 2023 had an inflow of 110 billion dollars.
As they stated, “they help more and more people to experience financial well-being”, that is, they invest in their capital.
They have been operating in Serbia for years and employ more than 500 experts in the fields of technology, accounting, risk management, and have teams that work in investments, legal affairs, finance, marketing, sales, and human resources.
“Black Rock” as one of the largest investment funds invests more or less everywhere, including in Serbian securities, i.e. Serbian debt. From the presentation of Vladeta Janković, it can be concluded that they bought our debt on the secondary market, which means from the first buyer, usually a bank, with a discount due to payment before the due date. On the contrary, the Prime Minister says that they were the first customer.
Regardless of who is the buyer of the Serbian debt and whether the securities have been resold, nothing changes for our country as a debtor. Bonds are issued to the bearer and it is completely irrelevant whether a third party appears as a creditor. Our obligations and rights do not change. We will only pay the initial debt not to the first customer, which is usually a bank, but to “Black Rock”.
The Prime Minister of Serbia, Ana Brnabić, stated two days ago in the parliament that the “Black Rock” fund did not take over Serbia’s external debt, because the bonds they own represent 0.4 percent of the total public debt of the Republic of Serbia.
Answering MP’s questions, Brnabić said that “Black Rock” is one of the funds that invests in domestic securities.
“In addition to them, more than 500 interested investors participated in the auction.” Total demand for our securities exceeded $11 billion. “Black Rock” invested about 80 million dollars at the last auction, or about 4.5 percent of the total issued bonds,” she said.
In total, “Black Rock” owns Serbian Eurobonds worth 138 million euros, Brnabić added.
“That represents 1.54 percent of the total issued bonds or 0.4 percent of the total public debt of the Republic of Serbia,” she said. All bonds of the Republic of Serbia that were issued on the international market are unsecured, she added. “This means that they are not guaranteed by the property of the Republic of Serbia, because otherwise they would be worth much more.” This is how investors trust that their money will be paid off”, she said.
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