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The Daily Roundup

Ezdan inks US$460mn syndi loan – Turkey unveils series of measures to help economy, banks – Nigeria DMO to issue US$302mn in local markets – South African current account gap widens – PIMCO bearish on EM equities – Petrobras divestment sales halted – US government to investigate Rosneft deal – China posts positive economic indicators

Dec 9, 2016 // 5:55PM

MIDDLE EAST & TURKEY

Ezdan Holding Group inked its debut syndicated loan with Mashreq, Dubai Islamic Bank and HSBC this week. The US$460mn 8-year facility was oversubscribed by 1.53x. Emirates NBD and Union National Bank acted as mandated lead arrangers, while Ahli United Bank, Al Hilal Islamic Banking Services and National Bank of Ras Al Khaimah acted as lead arrangers and BBK B.S.C, ICBC Doha and United Bank Limited as arrangers.

Fitch Ratings has once again raised concerns over bank market liquidity in the GCC in a new report, with the outlook for many of the region's banks likely to stay in negative territory throughout 2017 - a forecast driven mainly by deteriorating asset quality as a resuly of low oil prices.

The European Union has approved a €200mn (US£211mn) loan to Jordan to help fund the country's ambitious reform package and manage some of the stress on services caused by the rapid influx of Syrian refugees into the country.

The Turkish Government announced a raft of new measures aimed at supporting the economy, including helping commercial banks lend up to an additional TRY250bn. It will also be the guarantor for up to 100% of new commercial loans that will be taken out by exporters and SMEs, while the Ministry of Industry plans to boost direct lending to SMEs.

The IFC announced it would invest €80mn (US$85.3mn) of a 20-year €288mn project bond to finance the construction of new health care facilities in Elazig, the first project bond financing of a hospital under a public-private partnership (PPP) in Turkey.

 

AFRICA

Ghana's main opposition leader, Nana Akufo-Addo, has won the national election according to multiple local news agencies. Official results have yet to confirm Akufo-Adodo's victory over incumbent President John Mahama.

Nigeria has appointed Citigroup, Standard Chartered, and Stanbic IBTC to arrange its planned $1bn Eurobond sale, finance minister Kemi Adeosun revealed this week. The issuance is expected in the first quarter of 2017.

Nigeria’s Debt Management Office (DMO) said the country plans to sell NGN95bn (US$302mn) worth of 5, 10 and 20-year bonds on December 14th. The news comes the same day the African Development Bank (AfDB) approved a US$600mn loan to help support the Nigerian economy.

South Africa’s current-account deficit widened in the third quarter as exports of the nation’s mining and factory produce fell due to weaker international demand and a stronger currency. The gap on the current account, the broadest measure of trade in goods and services, widened to 4.1% of GDP in the three months through Sept. 30 from a revised 2.9% in the preceding quarter, the Reserve Bank said.

Tunisia will need TND8.5bn (US$3.7bn) in foreign loans in 2017, according to the country's Finance Minister Jalloul Ayed, over US$1bn more than originally anticipated.

Zimbabwe's Central Bank said it plans to pump another US$7mn worth of bond notes into circulation this week. The news came as the country's Finance Minister Patrick Chinamasa revealed key details about the country's US$4.1bn budget, which will see a funding gap of close to US$400mn. Growth is expected ot top 1.7% in 2017, the minister said.

Namibia's Central Bank left its benchmark repo rate steady at 7%, saying economic growth is expected to improve in 2017 after a slowdown this year, while inflation is expected to decline next year.

 

AMERICAS

PIMCO, one of the largest asset management firms in the US, has cut its holdings of emerging market equities from 'overweight' to 'neutral' on the back of concerns around anti-free trade and protectionist policies being introduced during a Trump presidency.

The Brazilian audit court, the Tribunal de Contas da União (TCU), has temporarily suspended all asset sales by Petrobras following concerns around non-competitive bidding at the firm. The move is not likely to impact the company's divestment strategy, according to Schildershoven Finance.

Inflation in Mexico continued increasing last month, and stood at 3.31% year on year for November.

The Republic of Ecuador priced an upsized US$750mn 10-year senior unsecured note offering via sole-bookrunner Citigroup, trimming 25bp off IPTs to yield 9.75%. The orderbook for the sale topped US$2.25bn.

 

RUSSIA, CIS & EUROPE

A newly published Fitch Ratings report suggests the Ukrainian banking sector continues to face challenges in credit growth despite a re-stabilisation following bank restructurings that took place in 2015.

Ukraine's Central Bank kept its main rate unchanged at 14% on this week, breaking a run of six consecutive cuts due to an uptick in inflation in October. The bank said it was "highly likely" inflation would hit its year-end target of 12%, but warned of risks to macroeconomic stability including from delayed disbursement of IMF loans due to the slow progress of reforms.

The US Government said it will investigate whether a Russian deal to sell a substantial stake in Rosneft to Qatar's sovereign fund, Qatar Investment Authority, and Glencore, have violated US sanctions on the state-owned oil company. Italian bank Intesa Sanpaolo is expected to fund a large portion of the acquisition costs, which are said to range between €10.2bn and €10.5bn.

 

ASIA

India's demonetisation initiative has disrupted the development of the country's development and could cause its delivery to be delayed, according to Reuters. It is expected to be presented on 1 February 2017.

India's Infrastructure Leasing & Financial Services Ltd. plans to raise more than US$1bn in bonds to fund road and other transportation projects.

The World Bank has cancelled a US$100mn loan to Pakistan for a natural gas efficiency project. The institution said the loan was cancelled due to the country's failure to progress on key development objectives, and a lack of interest from the region's main gas distributors.

China's Ministry of Commerce (MOFCOM) and the National Development and Reform Commission (NDRC) published a report this week claiming it may open its credit rating market to foreign participants, a move that could increase trust in the country's opaque institutions.

China’s factory-gate inflation rose to the highest since late 2011, helping to sustain prices around the world. Consumer prices picked up on rising food costs. The producer-price index jumped 3.3% in November from a year earlier, while the consumer-price index increased 2.3%.

The International Finance Corporation (IFC) and Cathay United Bank, from Taiwan, have agreed to lend US$50mn to Vietnam Prosperity Bank (VPBank). Each will lend US$25mn to support small businesses in Vietnam, with VPBank agreeing that one quarter of the finance will go to women-owned SMEs.

In South Korea, lawmakers on Friday voted decisively to impeach President Park Geun-hye following a scandal that gripped the nation for weeks and sparked massive anti-government demonstrations. Legislators in Seoul voted 234 to 56 to topple Ms Park, whose power transfers immediately to the prime minister while the matter goes to the constitutional court for a final ruling.

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