Victoria passes on federal guarantee

Victoria's state government will not take up the offer to make use of the Australian government's guarantee in selling state debt through the Treasury Corporation of Victoria, the Financial Review reported.

The newspaper reported today's budget will show the state has resolved that it believes it can obtain sufficiently cheap pricing, as well as maintain demand among investors for its debt, without the guarantee.

State government will have to pay a fee to Treasury to make use of the Australian governnment's credit rating that starts at 30 basis points depending on the term.