CEE Bonds

Russian Railways launched the first international green bond from its home country on Thursday, a €500m eight year bond. While many emerging market investors were keen to look at the paper, despite the US considering a new round of Russian sanctions, several green investors disliked the company’s ESG enough to not participate.

The European Investment Bank (EIB) has moved its new Climate Awareness Bond (CAB) documentation beyond the eurozone with the sale of a Polish zloty bond to a single Japanese investor.

Ceske Drahy, the Czech national railway company, hit screens on Thursday announcing a euro benchmark, returning to the bond market for the first time in three years.

Books for Russian Railways’ eight year euro green bond had breached the €1.4bn mark by lunchtime on Wednesday, allowing leads to tighten pricing. A banker away from the note said the levels offered looked fair.

Nepi Rockcastle, a Johannesburg- and Amsterdam-listed real estate fund, printed a €500m four year bond on Wednesday. In doing so, it seemed to shake off concerns about the company raised by research firm Viceroy in November, though investors still had questions during the marketing of the bond.

Russian Railways has told investors that it is focusing on an eight year tenor for its euro green bond, with pricing for the benchmark expected "as early as tomorrow." The deal will be the first international green bond from the country.

Investors appear to be split over whether or not Turkey will follow through with its proposed purchase of a Russian S-400 missile system, in the face of likely sanctions from the US if it does.

Investors are clear that president Recep Tayyip Erdoğan is once again to blame for another tumultuous week in Turkish assets. The country’s fate in the capital markets is in his hands. Investors have been quick to forgive in the past but their patience is not infinite.

Alpha Bank’s subsidiary in Romania has issued its inaugural covered bond (CB) — the first from the country. The ground-breaking deal represents an important milestone in the development of the Romanian capital market and helps diversify the bank’s funding.

Novolipetsk Steel (NLMK), a Russian steelmaker, is embarking on a roadshow to market a dollar benchmark bond with a five to seven year maturity as issuers and investors brush off the risks of further US sanctions on the country.

The Turkish lira this week tumbled to levels it had not seen since last October’s economic crisis after Turkey’s electoral commission (YSK) annulled the results of Istanbul’s municipal elections that had been won by the opposition. Investors said they are concerned that economic reforms will be put on hold and are worried that higher interest rates will prolong the country’s recession.

Russian Railways is embarking on a roadshow to market its first green bond, which DCM bankers say is the first international green bond from the country. It it entering the market despite a round of US sanctions seeming to be on the way.