Industry and Construction Bank

  • 22 Sep 2005
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Rating: Ba2/B (Moody's/Fitch)
Amount: $400m
Maturity: 29 September 2015
Issue/re-offer price: 100.00
Coupon: 6.2%
Launch date: Thursday 22 September
Payment date: 29 September
Joint books: ABN Amro, Deutsche Bank

Bookrunners' comments:

ABN Amro — We did a deal for ICB less than three months ago and they wanted to return to the market to work on their capital ratios, so a lower tier two transaction made sense.

We attracted a lot of the previous buyers plus some new ones. People were interested in the VTB ownership story, with Russian investors obviously being more familiar with what is going on.

VTB owns 25% of ICB and has made it plain that it wants to buy another 50% plus one share by the end of the year or early 2006.

If you look at the comparables, on Wednesday the ICB 2008s were yielding 5.80% while VTB's 2008s were at 5.12% and its 2011's at 5.53%.

If you extrapolate off the senior five year debt, they have pulled off a great deal: it should come in wider by a minimum of 3/8 but we priced the deal at 6.20% — that means it only cost 8bp to add subordinated debt, which is absolutely nothing.

This deal came with a coupon even lower than the lower tier two deals by VTB and Sberbank — that combined with the tightness of the new sub-debt level versus where a senior five year would be is quite an achievement.

Deutsche — ICB did a senior deal in July, which was successful and has performed well. Investors were familiar with their credit and what they are doing.

The UK took 31% of the paper, eastern Europe 25%, Asia 12%, Switzerland 8%, Germany 7%, Greece 5% and elsewhere 12%.

Banks accounted for 48% of the book, funds 41%, retail 8% and others 3%.

While ICB is an attractive credit for investors, demand for Russian credit as a whole is very strong. Russia has performed well and continues to perform well.

If you like the banking sector, and you like the strong banks, then buying a lower tier two transaction from them enables you to pick up the better yield.

  • 22 Sep 2005

All International Bonds

Rank Lead Manager Amount $bn No of issues Share %
  • Last updated
  • Today
1 JPMorgan 92.59 388 8.96%
2 Citi 85.30 278 8.25%
3 BofA Securities 63.15 265 6.11%
4 Barclays 58.01 223 5.61%
5 Deutsche Bank 55.74 184 5.39%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $bn No of issues Share %
  • Last updated
  • Today
1 BNP Paribas 60.87 123 14.06%
2 Credit Agricole CIB 28.59 93 6.60%
3 Santander 25.41 90 5.87%
4 JPMorgan 23.88 61 5.52%
5 UniCredit 21.51 103 4.97%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $bn No of issues Share %
  • Last updated
  • Today
1 Goldman Sachs 2.07 11 10.42%
2 BofA Securities 1.40 6 7.01%
3 Citi 1.37 7 6.87%
4 Morgan Stanley 1.36 6 6.85%
5 JPMorgan 1.31 7 6.59%