CEE Bonds

European credit and equity markets suffered a sustained battering this week with financial borrowers facing ever greater scrutiny in the wake of poor results and concerns about their ability to meet coupon payments.

Hopes of primary issuance from CEEMEA receded again on Thursday as regional borrowers were caught up in the global market turmoil.

The recent new issues from Turk Eximbank and Kuveyt Turk are both trading well, leading to hopes that further bonds from the country may follow.

Kuveyt Turk, an Islamic Turkish bank, survived a rough market on Monday to print a $350m Basel III compliant tier two sukuk. Even the leads were surprised by how well the deal went, although their own orders and the high yield on offer helped.

Markit is preparing to launch what it said will be the first tradable emerging markets interest rate swap index.

Kuveyt Turk has released initial price thoughts for the third Basel III compliant tier two bond to come out of Turkey.

Russia released a request for proposals late last week for its first Eurobond since 2013. Of the 23 banks that that received the RFP, “most” are expected to pitch for the bond, said bankers in London.

Two Latin American multilaterals this week defied investor jitters around looming US non-farm payroll numbers to tap the Swiss franc market.

Türk Eximbank issued a $500m five year bond on Monday, commanding a $1.09bn book and bringing hope to syndicate officials that more deals from the country may follow.

Standard & Poor’s cut Azerbaijan’s credit rating to sub-investment grade on Friday as declining oil prices and general government deficits continue to put downward pressure on the sovereign.

Turk Eximbank (Turkiye Ihracat Kredi Bankasi) has released initial price thoughts for the first Turkish bond of the year at 425bp area over mid-swaps.

Bondholders of a $211m private placement issued by the International Bank of Azerbaijan (IBA) met last week to discuss the bank’s request for a waiver after it unknowingly breached the bond's covenants.