Bosnia's autonomous Bosniak-Croat Federation raised 40 million Bosnian marka ($21.3 million) on Tuesday via an auction of three-year domestic bonds to help plug a budget gap. Bids totalled 99.5 million marka, data from the Sarajevo Stock Exchange (SASE) showed. They sold at a weighted average yield of 2.992 percent, up from 2.211 percent at the previous sale of the three-year paper last December.

The Federation cut its spending plan for 2016 to close a financing hole that emerged when the International Monetary Fund and World Bank withheld funds pending economic reforms. Bosnia's two autonomous regions, the Federation and the Serb Republic, have a combined budget gap of about 1 billion marka.

In September, the IMF approved a 553 million-euro ($577 million) loan programme to support economic reforms in the impoverished Balkan state. The Washington-based lender has already disbursed 79.2 million euros. But to access the next tranche of about 80 million euros, Bosnia must pass a law raising excise taxes while the two regions must adopt their 2017 budgets and new banking laws.

Copyright Reuters, 2016