Middle East Bonds

Etihad Airways will meet investors from Thursday to introduce a structured deal that has been alternately described by bankers away from the transaction as “impressive” and “too clever by half.”

The Republic of Iraq starts a five day roadshow on Thursday, ahead of what would be its first international bond deal in almost a decade.

After being reopened by the strongest of the strong, the CEEMEA market’s attention has moved to the other end of the credit spectrum with Iraq and Egypt eyeing the dollar market.

Egypt is planning to launch another deal from its $10bn conventional bond programme before year end, which should be followed by an international sukuk, delegates at the Euromoney Egypt Conference in Cairo heard this week.

Lebanon has sent out its request for proposals for a new Eurobond, just as Moody’s warned that political protests reflect growing instability that could hit economic growth and confidence in the banking system.

Saudi Electricity Co has received approval from its executive committee for a new sukuk programme and a revolving credit facility. If the firm deploys the former this year it should help breathe life into a sukuk market that has lost much of its steam after a strong start to the year.

A week of equity market madness has left many Middle East and African bonds anywhere from 20bp to over 100bp wider since Monday, and dashed hopes of a rousing restart to CEEMEA supply come September. But for the Middle East, at least, debt bankers are looking forward to a bumper 2016.

Plunging Middle East stock markets have yanked bond spreads wider in their wake and raised doubts about the chance of a strong CEEMEA restart in September.

We remarked last week that emerging markets could face a difficult time ahead. Well, we didn’t have to wait long before the early manoeuvers in a possible currency war had an impact on sovereign CDS spreads.

Kuwaiti financial Burgan Bank has receive approval to buy back $400m and KD100m ($329.7m) in subordinated debt, which will no longer count as capital under Basel III regulation.

An Iraq sovereign bond deal looms ever closer, but is not expected to open the floodgates for bonds from other entities from the region.

Iraq is said to have awarded a bond mandate to Citi, Deutsche Bank and JP Morgan for a deal that could come as soon as the fourth quarter of this year.