Central and Eastern Europe (CEE)

Russia bonds burst back to the top of the emerging market priority list without a sanction being lifted after Alfa Bank smashed through its own yield curve on Wednesday. Demand is rampant among supply-starved investors who will be gleeful about the thawing of the geopolitical frost between Russia and the west, writes Francesca Young.

A 12 month roller coaster ride for US rates expectations has ended with the 10 year Treasury yield back where it started, and in the meantime the CEEMEA bond market has been turned on its head for completely unrelated reasons.

Alfa Bank’s print of $500m 5% 2018s on Wednesday, which smashed 25bp through its own curve, demonstrated how big investor demand for Russian credit has become as the geopolitical frost begins to thaw.

Renaissance Securities is offering to buy back what remains outstanding of Renaissance Credit’s 7.75% 2016 bonds.

The order book for Russian Alfa Bank’s first senior unsecured bond in three years has reached $2.75bn, and guidance for the three year note has been crunched to 5.125% area.

Novorossiysk Grain Products Plant, Russia’s largest grain export shipping terminal, has set the price range and opened the book for its IPO, in which it will join the first section of the Moscow Exchange.

CLS Group added the Hungarian forint to the list of currencies eligible for settlement. The group, which settles trillions of dollars in foreign exchange transactions a month, now settles payment instructions in 18 currencies.

Bankers are predicting a strong return of Russian bond issuance from non-sanctioned credits in 2016. But these issuers would be foolish to wait until next year when there is an issuance window open now.

Alfa Bank has mandated three banks for a senior dollar bond — only the second Russian financial institution bond this year — as the CEEMEA bond markets held stable after the terrorist attacks in Paris over the weekend.

Ukraine’s Privatbank has received approval from the High Court of England and Wales for a restructuring deal approved by holders of its subordinated Eurobonds.

In this round-up, Moscow Exchange sees fall in both spot and swap trading, South Korea deposits drop for sixth consecutive month, and the Swiss franc is now directly convertible with the onshore RMB. Plus, a recap of GlobalRMB’s top stories this week.

Bank of Georgia completed the IPO of its healthcare subsidiary on Monday, as it successfully priced the deal, although at a price much below what it had hoped for.