CEE Bonds

The CEEMEA bond market exploded into life this week in what will be one of the busiest of the year. Saudi Arabia is leading the action with its much-anticipated bond but Turkey made an impressive comeback with four of its banks in the market following Friday’s sovereign trade. Further supply from Poland, Russia, the Middle East and Africa is adding plenty of diversity for investors.

Poland cemented its position as one of EM’s most nimble and savvy issuers on Tuesday by printing a 30 year euro deal — only the second ever from a non-Eurozone sovereign — in an opportunistic trade.

Plans abound to connect China’s bond market with offshore counterparts but they have had little success until recently. Now Russia’s National Settlement Depository (NSD) is close to launching a link in the first half of 2017, Eddie Astanin, chairman of the executive board, told GlobalRMB.

Primary bond markets were awash with Turkish bank deals on Tuesday as Turk Eximbank, Sekerbank and Kuveyt Turk added to Isbank’s Monday mandate. With books slow to build and Turkey recently losing its investment grade status, lead managers believe new issue premiums will need to offer a reason to invest.

Republic of Poland raised €500m with its longest ever syndicated bond as part of its push to extend the average duration of the country’s debt by taking advantage of low rates, as Slovenia made plans to reduce debt costs by buying back three of its dollar bonds.

Investors are soon to be treated to the lowest rated Russian bank debt since 2012 as Tatfondbank embarked on a roadshow for a three year deal to test just how strong demand is for the asset class.

The Polish national champion successfully issued its first euro denominated covered bond benchmark on Monday, and the first publicly syndicated deal ever issued by a Polish bank in the euro market.

Turkey shrugged of its second downgrade to junk on Friday to print a $1.5bn reopening of its 2026s. And if a sovereign bond was not proof enough that it is capital markets business as usual for the country, state-owned Turkiye Is Bankasi AS (Isbank) was out with a long five year on Monday morning.

Next week is likely to be one of the busiest in the fourth quarter in covered bonds, as a string of debut deals emerge, along with the first ever publicly syndicated euro benchmark from Poland.

Poland’s Bank Gospodarstwa Krajowego (BGK) is tapping the 10 year bond with which it made its debut earlier this year.

Russia plans to raise $7bn in the international markets next year as part of a three pillared approach to reduce its budget deficit, as sanctions and low oil prices continue to stunt its growth.

Eastern European telecoms operator RCS&RDS on Thursday printed a refinancing euro bond that was first planned in euros and Romanian leu, while it mulls a potential IPO.