CEE Bonds

The decision by a joint venture between Russia and China to invest up to $2bn in key infrastructure projects will relieve the pressure on the Russian government to attract funds to offset the massive flight of capital.

Franklin Templeton is betting heavily on Ukraine’s ability to avoid full scale civil war, holding $7.6bn of the country’s bonds.

Following the success of Montenegro’s €280m five year bond, conditions are ripe for other Balkan and central European sovereigns to tap the market.

Warsaw is home to the largest CEE-headquartered stock exchange, Bucharest is rapidly trying to replicate the structure, while Vienna dominates the Central and Eastern Europe Stock Exchange Group. Throw the Moscow Exchange into the mix and the battle for the CEE power exchange will prove a fascinating one.

Sharp falls in Russian stock markets offered opportunities for brave investors. Some have already moved in to snap up bargains but investors fallowing in their wake may now be too late Those waiting for an opportunistic moment to buy into Russian equities may be a little late: the real bargains have already gone.

Ukraine has printed its $1bn five year bond back by US-AID, with investors hoping that the US government will see this as a more regular financing tool for Ukraine as the country faces the threat of civil war in the eas of the country and a high level of redemptions over 2014-2015.

Rival bankers are suggesting that the mandate for the Ukraine US-AID backed deal may be a poisoned chalice for JP Morgan and Morgan Stanley's EM bond businesses if a resurgence of Russian issuance comes sooner than is widely expected.

The splintering of Ukraine could have a big impact on the country’s bonds, according to an analyst who warns that debt might have to be reissued or even defaulted on if the country continues to lose regions to independence — or Russia.

Russian bond volumes have been hit hard since the beginning of the Ukraine crisis, but rotation into the rest of EM has brought hope to DCM bankers

Putin’s Ukraine gamble might have paid off from a political standpoint — his popularity at home has soared since the annexation of Crimea — but it is in real danger of wrecking an already weak Russian economy.

Turkey dominates the sukuk scene in central and eastern Europe via the sovereign and participation banks. But the Czech Republic has emerged as another possible breeding ground for Islamic finance

Tensions between ex-finance minister and prime minister could hamper Croatia’s economic reforms — and bond market return