The Bulgarian Finance Ministry place a proposal for replacement of USD denominated ZUNK bonds with an issue of long-term government securities denominated in EUR, Bulgarian National Bank announced. The subscription starts today and will be effective until June 27. The replacement will be executed on July 3. The minimum amount of ZUNK that a holder can replace is set at USD 100,000. With this act the Bulgarian government is trying to reduce the currency risk on dollar-denominated domestic debt. Local currency is fixed under the regulations of the Currency board in Bulgaria (BGN1=EUR 0.51). However, the terms of the replacement are unfavourable, since they do not compensate for the negative interest spread as a result of lower EUR interest