CEE Bonds

Turkish conglomerate Doğuş Group looks set to become the first Turkish corporate borrower to issue a dollar sukuk, having applied to the country’s Capital Markets Board to issue up to $400m to foreign investors.

Turkish participation bank Albaraka Turk (rated BB by Standard & Poor’s) has given revised official guidance of 6.25% area on its five year benchmark sukuk, with pricing expected to follow on Tuesday.

The Turkish economy is beset by high inflation, sluggish GDP growth and a large current account deficit. Although the path ahead is daunting the country is showing strong signs of the necessary rebalancing. But the greatest threat to Turkey’s recovery is prematurely loose monetary policy, which is just what the central bank is under pressure to provide. Steven Gilmore reports.

Turkish banks are having a tough time. High interest rates, slow growth and a cheaper lira are all likely to persist, and credit expansion has slowed. But in the Eurobond market this competitive bunch of issuers are learning quickly how to make the most of the capital markets. Francesca Young reports.

This week’s CEEMEA and Latin American bond deals were trading up across the board on Friday, regardless of whether they offered chunky or non-existent new issue concessions. And while relative value rather than fundamentals drive investors’ decisions, the emerging market rally is only going to run and run, said bankers.

China Construction Bank (CCB) Asia printed the first ever dim sum bond to be issued in Switzerland on Thursday, selling a Rmb1.25bn ($203m) three year print. The deal highlights the renminbi’s growing presence in Europe.

Turkish banks pushed on apace with international funding drives this week, despite rising fears over Iraq knocking some froth off their recent strong rally. Isbank and Kuveyt Türk priced well with benchmark bonds and sukuk, while Albaraka Türk completed its sukuk meetings and Ziraat Bankasi announced plans to go on the road with a long-awaited inaugural dollar deal.

This week’s CEEMEA and Latin American bond deals were trading up across the board on Friday, regardless of whether they offered chunky or non-existent new issue concessions, reports GlobalCapital. And while relative value rather than fundamentals drive investors’ decisions, the emerging market rally is only going to run and run, said bankers.

Russian state controlled banks Sberbank and Gazprombank are preparing to bring the first benchmark deals from the country in almost four months. Deep demand, competitive pricing and lower execution risk have pulled both borrowers to euro market — Sberbank for the first time. Bankers and buyers are predicting smooth execution, and welcomed the first real sign of the Russian market’s rehabilitation.

China Construction Bank (CCB) Asia is out in the market what bankers believe is the first dim sum bond to be issued in Switzerland as the bank deepens its involvement in the renminbi’s burgeoning presence in Europe.

Munich Re could potentially shave another 75bp off the price of its cover for US hurricane and Australian cyclone risk next week, after putting out price guidance for the tenth catastrophe bond from its Queen Street platform.

Poland’s PZU Group has picked banks for a debut bond deal, following fellow Polish corporate debutants PGE and PKN Orlen into the euro market.