CEE Bonds

Bulgaria has released a request for proposals to arrange a Eurobond, according to two DCM bankers in London.

Sberbank is roadshowing a tier two bond in the US and Europe from Monday to Wednesday and will try to issue under refined documentation language with regards to Russia’s Basel III framework for subordinated debt.

Emerging markets have overtaken eurozone sovereign debt problems and central bank stimulus withdrawal as the biggest threat to European credit markets, according to European credit investors in Fitch Ratings' quarterly survey. The report highlights how quickly the market view has changed on the emerging markets versus Europe, but bankers are saying it could just as easily switch back.

The EM primary bond market is still recoiling from the latest Federal Reserve quantitative easing tapering action, weakened emerging market currencies and the resulting sell-off in secondary bond market trading levels.

The resilience of Europe’s high yield bond market to recent financial volatility is likely to ensure continued investor demand for the asset class through this week, bankers said on Monday.

Russian Railways has set a nine year maturity for its euro-denominated bond. The company’s spreads have stabilised after the sell-off in EM assets last week and the issuer is monitoring the market for an opportunity to price this week, according to an origination official on the deal.

Sberbank Europe has hired Tamas Haiman as head of global markets. Haiman will start on February 3, based in Vienna reporting to Igor Strehl, member of the management board, Sberbank Europe, and Alexey Zaytsev, head of regional and international global markets management, global markets department at Sberbank CIB.

VTB Capital Investment Management has launched a $40m Russia & CIS debt fund in UCITS IV format. Domiciled in Luxembourg, an additional $20 million of soft commitments have already been pledged.

Czech energy utility EP Energy attracted more than €1.5bn of orders on Friday for the first bond issued by its holding company, thanks to strong demand from traditional European high yield buyers.

With dollar funding again stymied, a banner performance in sterling underscored the UK currency’s increasingly strategic appeal to bond issuers, some bankers argued this week — highlighting a rise of almost £1bn in new issues compared with the same period last year. But others see little more than an opportunistic grab at basis swap arbitrage.

Czech energy utility EP Energy launched its first high yield bond through its holding company on Tuesday, despite a sell-off of emerging market bonds.

A €470.2m exchangeable bond from ČEZ, the first equity-linked transaction from the Czech Republic, saw a surge of demand from investors hungry for investment grade paper.