CEE Bonds

Emerging market bonds have been buoyed by several positives in key markets this week including a cabinet reshuffle in South Africa that has seen the return of respected former finance minister Nhlanhla Nene, and the upgrade of Russia to investment grade by S&P.

Ukraine’s DTEK is meeting fixed income investors this week to update investors. The borrower is in the process of restructuring some outstanding bank loans.

The State Export-Import Bank of Ukraine printed its local currency bond on Tuesday, but needed to pay an eye-watering 16.5% coupon to do so.

State Export-Import Bank of Ukraine has opened books on a hryvnia Eurobond with an eye-catching 16% area yield.

Orders reached €1.6bn for Západoslovenská energetika (ZSE)’s five year note on Monday, marking a subscription rate of five times for Slovakia’s largest distribution operator.

Russia’s return to investment grade status could unlock $2bn-$3bn of passive inflows, according to analysis by Goldman Sachs — though this is expected to result in a gradual grind, rather than a sudden snap tighter in spreads. Bankers said that credit committees may also consider lending to Russia again.

Albaraka Turk broke new ground last week it has emerged, issuing the first ever Basel III-compliant additional tier one (AT1) from Turkey in a private placement. The deal has set a structuring template for future Turkish AT1 issuance, and has sparked interest among those looking to bring the next, possibly public benchmark, deal, writes Virginia Furness.

The Republic of Belarus has printed its $600m 12 year bond through its curve despite other emerging market sovereigns paying up for their bonds over the past fortnight.

State Export-Import Bank of Ukraine has wrapped up investor meetings for an internationally cleared hryvnia bond with the deal expected to generate plenty of interest.

The Republic of Turkey is preparing to issue its first Panda bond by the end of the year, having mandated three banks to handle the deal.

Trans-Oil, a Moldovan agro-industrial firm, failed to generate enough interest in its debut bond offering on Wednesday, becoming the second CEEMEA issuer in as many weeks to fall foul of tougher market conditions.

Moldova’s Trans-Oil opened books on the first ever Eurobond from the country on Wednesday, but the small size is likely to mean it flies under the radar of most investors.