CEE Bonds

Hungary has filed a registration statement with the SEC to issue up to $5bn in debt securities, and analysts are expecting the sovereign to take advantage of the chunky new programme before the end of the year.

Gazprom broke the CEEMEA bond market silence with a seven year sterling deal on Wednesday. It had the market to itself as other issuers waited for the Federal Open Market Committee meeting in the US to end before bringing deals.

CEEMEA issuers poised for dollar deals are eagerly awaiting the outcome of the Federal Open Market Committee meeting before taking advantage of a stronger appetite for EM debt. But Gazprom saw a clear window for its sterling bond, and with no reason to wait, it opened books on Wednesday morning for a seven year bond.

The CEEMEA market had a strong opening on Monday morning, with buyers a clear majority in the secondary market and last week’s primary transactions performing well. But borrowers are still opting to hold off until after the Federal Open Market Committee meeting on Wednesday.

Romania finished off its 2013 funding needs with a well received €1.5bn Reg S bond on Thursday — drawing €6.4bn of orders for its seven year deal. Some analysts with a positive view on the credit argued it gave its paper away too cheaply, but the issuer and bookrunners said the transaction was a strong success.

The Republic of Armenia finished investor meetings this week ahead of its debut dollar Eurobond, which Fitch has assigned an expected BB- rating. Neighbouring Georgia will offer the best reference point for pricing, but Armenia may struggle to print tighter than its better rated peer.

Gazprom has mandated Deutsche Bank and JP Morgan for a sterling deal, according to two bankers away from the deal, after dropping its plans for a transaction in that currency earlier this year.

Russian oilfield services company Borets International has mandated Deutsche Bank, Morgan Stanley and Sberbank to arrange a dollar bond. Roadshow meetings will start on Monday and visit the US, Switzerland, Germany and London before finishing on Wednesday next week, the day of the Federal Open Market Committee meeting in the US.

Romania opened books on a benchmark Reg S euro deal on Thursday morning and is aiming to price the seven year transaction in the afternoon. A €1bn bond would round off the sovereign’s borrowing programme for the year and it is offering a decent spread that should bring in buyers, said bankers away from the bond.

Russia and South Africa have given their sovereign peers a superb demonstration of the deal sizes on offer in the CEEMEA market. The Russian Federation launched a long awaited multi-tranche bond taking $6.96bn across euros and dollars, while South Africa printed a well oversubscribed $2bn deal. Bankers hope the two transactions will encourage the long line of countries considering deals to follow, but both deals also made clear the need for big new issue concessions.

Gazprom has mandated Deutsche Bank and JP Morgan for a sterling deal, according to two bankers away from the deal, after dropping its plans for a transaction in that currency earlier this year.

The Republic of Armenia starts investor meetings this week ahead of its debut dollar Eurobond, which Fitch has assigned an expected BB- rating.