CEE Bonds

Ukraine’s wildcard new president Volodymyr Zelensky has been making all the market-friendly noises investors could wish to hear, turning the country into a darling of emerging market portfolio managers. But there’s a wasp at the picnic: one oligarch's quest to regain his former bank is threatening the country’s economic future.

Russian petrochemicals firm Sibur was able to print $500m of five year paper in its return to the bond market this week, brushing off news of a drone attack on Saudi oil infrastructure and a subsequent 10% jump in the oil price.

Fears are growing that Ukraine’s Privatbank, which was nationalised in 2016 at the behest of the IMF, may be reprivatised thanks to pressure from its former owner, oligarch Igor Kolomoisky. Such a move could jeopardise Ukraine’s chances of a new helping of IMF cash and the country’s bonds have sold off in response.

The blow to oil production in the Middle East seems to have boosted demand for Russian petrochemical giant Sibur's five year dollar benchmark on Monday — the issuer’s first bond in two years.

After several years of rumours and speculation, Russia’s long nurtured plans to issue renminbi government bonds will come to fruition in this year or in early 2020. The country will not borrow in dollars, but may borrow in euros and yuan, writes Lewis McLellan.

Russian pipe manufacturer Chelyabinsk Pipe Plant on Thursday sold one of the tightest ever Russian debut bonds, according to a lead manager on the note.

The Turkish central bank delivered a 325bp cut to its main policy rate on Thursday. Although the move is larger than the 250bp consensus that had emerged ahead of the meeting, many analysts had been fearful that the move would be even more drastic — and the market appears to be rallying in relief.

A pair of Eastern European corporate borrowers are in the market for dollar paper on Thursday, taking advantage of excellent market conditions to secure cheap funding.

Armenia is the latest EM borrower to take advantage of rock bottom rates with a tender offer and new bond. The sovereign will tender a 2020 bond, financing the operation with a new Eurobond.

The first deal of the September rush set an impressive bar for a rush of borrowing from its peers in the commodities sector. Russia's Severstal pulled off an $800m five year bond priced flat to its curve, achieving the lowest yield ever for a corporate from the region.

Prima banka Slovensko is set to become the third Slovakian issuer of euro covered bonds after it mandated lead managers on Monday for a roadshow.

Fitch Ratings raised Ukraine’s credit rating from B- to B with a positive outlook. However, Bank of America Merrill Lynch believes that the country is still at risk of another debt restructuring.