UPDATE 1-Czechs to tap markets with debut 50-yr bond Nov 21

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The Czech Republic will offer 8 billion crowns ($439.8 million) worth of its first-ever 50-year domestic bond on Nov. 21 to cater to investor demand for ultra-long paper, the Finance Ministry said on Thursday.

In a statement, it said it would set a fixed coupon for its longest-dated paper the day before the special auction.

The ministry said it would top the auction up by a further 10 billion crowns worth of the 50-year paper which it will take into its own portfolio as part of its strategy to gradually replace short-term Treasury bills and cut its refinancing risk.

The offering would lengthen the maturity horizon of Czech bonds, boosting the European Union member country's presence on the far end of the yield curve after its first issue of 30-year note in December 2006.

The Czech Republic would become the fifth European country to have issued 50-year government debt, following France, Greece, Italy and Britain.

Pension funds tend to be eager buyers of long-dated bonds to match their long-term liabilities.

The Czech ministry asked investors in mid-September to indicate how many of the 50-year bonds they would like to buy and what yields would they expect for such paper. It had planned to launch the bond this month if it received positive feedback. (Reporting by Marek Petrus; Editing by Gerrard Raven)

Keywords: CZECH BOND/

[PRAGUE/Reuters/Finance.cz]