Search results for

After being shut out of the international bond markets for more than three years, Russian issues are finally finding opportunities for issuance, and it has been a steep learning curve for both issuers and lead managers, with some successes - such as City of Moscow's trailblazing three year deal - and some failures - including a poorly timed bond from Rosneft. Guy Norton reviews a rollercoaster five months and looks ahead to a corporate pipeline that is already building again.

With the growing interest from both international debt and equity investors in the Russian capital markets, the need for reliable economic data on which to base investment decisions has arguably never been greater. "Investors realise that they can't afford to ignore Russia, but they need to have access to comprehensive data," says Paul Timmons, an ecomomist at Moscow Narodny Bank in London.

All eyes will be on media and IT company RosBusiness Consulting later this month, which is looking to launch a pioneering share offering on the Russian equity stage. If the planned domestic IPO is a success, market watchers hope it will prompt fellow Russian corporates to issue equity on the bouyant Moscow bourses. Guy Norton evaluates its chances.

Change is in the air in Moscow. The Russian people are at last looking to the future, rather than yearning for the Soviet past, and president Putin still has at least 12 months before elections take centre stage to keep up the momentum of reform. Market watchers say that 2002 is a real opportunity for Russia's banking sector to embrace this new zeal for modernisation - but the question remains whether investors, domestic and foreign, can leave behind the shadow of 1998. Guy Norton reports.

The bank market has quickly forgotten the losses incurred after a moratorium on $4bn of commercial bank debt was declared in 1998 and Russian borrowers have discovered a new found popularity. Top oil and gas borrowers are negotiating five year tenors, less complex structures and tighter margins; financial institutions are enjoying looser terms and a diverse range of corporates are edging closer to the market. Ruth Lavelle and Colette Campbell investigate the changing perceptions of Russian risk.

After an 18 month hiatus, Russia returned to the international equity markets in February with a $226m IPO from Wimm-Bill-Dann, an ambitious corporate which shrugged off allegations of mafia links to sell over 12m shares. Fellow manufacturer Danone took a 4% stake in the company, and, as Guy Norton reports, there were plenty of other investors convinced by the story.

Glasgow, Scotland-based Abbey National Asset Management, which manages roughly £4.5 billion in fixed-income assets, is shortening duration in gilts in an attempt to protect itself from potential weakness in the market on the back of improved economic growth. Rod Jack, the firm's fixed-income investment manager who focuses on the U.K. government market, says the next purchase will likely be the U.K. 5% bonds of '12, which are being auctioned this week and should bring interest into the market, because investors want to increase their liquidity. The firm has recently upped its allocation to cash from 2-3% to 5-6% on the view that yields will continue to fall.

The Allstate Corporation is looking to add $20-25 million in bonds of distressed investment-grade telecoms, such as Qwest Capital Funding,Sprint Corp., or WorldCom. Mark Cloghessy, portfolio manager overseeing the firm's $13 billion investment-grade bond portfolio, says he believes investor concerns that these companies will not be able to maintain access to funding are exaggerated, and that spreads will narrow. He would like to add the Qwest Capital Funding 7.25% notes of '11 (Baa3/BBB), which were trading at 490 basis points over 10-year Treasuries on March 22. The issue was trading 130 basis points wide of the Qwest Corp. 8.875% notes of '12 (Baa2/BBB) on March 22. Cloghessy says that while Qwest Corp. produces more cash flow, he does not believe it justifies the spread differential, noting that Standard & Poor's gives the Qwest Capital Funding issue the same rating. Cloghessy would rather add Qwest than Sprint or WorldCom because he does not own any Qwest paper. However, he is concerned about the Securities and Exchange Commission inquiry into the company. Before investing, he would like some assurance that the company will go ahead with a planned convertible bond issue to provide much-needed liquidity.

A time of the signs ... Loan Market Week has been remiss in not updating the story of the riveting saga it first reported on back in December: the state of the large sidewalk sign in front of J.P. Morgan Chase's Park Avenue headquarters. When we last reported on the condition of the imposing nameplate, the banking behemoth had covered it with a blue vinyl slab with the name and logo smartly embossed in white letters. The new covering went over the metal panels sporting the JPMorganChase name which went over the granite/marble sign sporting the Chase Manhattan name. The metal panels were looking a little rough, with some details in the letters knocked out and some minor discoloring on the borders. But in an incredible plot twist, it turns out the blue sign was just a temporary measure until a brand spanking new metal sign was set to be mounted, in all its glory. Stay tuned.

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.