CEE Bonds

Slovenia took full advantage of its early market move on Thursday to secure its tightest ever spread, and what it expects to be its lowest coupon, on a new euro-denominated note.

Emerging market bond fund managers say they are markedly more optimistic than 12 months ago when the "whole world was negative" after the start of Donald Trump’s US presidential term. And with plenty of sovereign trades rumoured for January, there is an abundance of investment opportunities.

Deutsche Bank’s head of origination for corporate and financials in CEEMEA has moved to one of the bank’s clients as chief financial officer.

For CEEMEA bonds, 2017 was a record breaking year and one which pushed the boundaries of product, tenor, and issuer. The $200bn of bonds raised in CEEMEA, and the $140bn raised in Latin America are the highest annual volumes on record. Investors’ seemingly insatiable appetite for EM debt fuelled massive inflows into the asset class and kept the many idiosyncratic risk events – from Qatar’s regional isolation to deteriorating relations between Turkey and the US– contained. Picking out the deals of the year for 2017 was not easy for GlobalCapital’s editorial team, but after much deliberation the below were chosen.

Top emerging market bond investors are warning that making strong returns will be much more difficult in 2018, as elections and interest rate risk introduce more volatility into the markets.

Promsvyazbank, Russia’s ninth largest bank by assets, has become the third major Russian private bank this year to be bailed out by the Bank of Russia.

A planned Eurobond from Tengri Bank, Kazakhstan’s 24th largest lender, failed to appear in the public market on Friday, when it had been expected to be priced.

Kazakhstan’s 24th largest lender Tengri Bank was asking investors this week to extend financing amounting to over 50% of its total assets. The bemused buy-side is not exactly piling in.

Emerging market bankers said a pipeline of local currency Eurobonds is building for 2018 — including another in tenge — with Development Bank of Kazakhstan’s (DBK) recent tenge trade setting a good tone in the market last week.

Development Bank of Kazakhstan on Thursday priced the first ever tenge Eurobond, raising the equivalent of $300m from a three year note.

International investors were eyeing the first Kazakh tenge trade to be cleared by Euroclear on Thursday.

A variety of corporate deals are keeping EM investors busy in what is expected to be the last week for new issues before the end of the year.