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The Daily Roundup

GIB raises US$500mn in fresh bonds – QNB in early loan talks – Turkey taps the market with US$2bn bond – Mozambique gets outlook upgrade by S&P – Nigeria DMO sees strong demand for local currency notes – Colombia hits the market – Brazil targets reforms – Embraer to test bond market after corruption controversy – VEB mulls 2017 Eurobond – China continues to unload USTs

Jan 19, 2017 // 6:47PM


Bahraini lender Gulf International Bank has this week raised US$500mn in a benchmark-sized 5-year bond with a coupon of 3.5%. The notes were priced at 99.461%. Citigroup, Gulf International Bank, HSBC, JP Morgan, Mizuho Financial Group, National Bank of Abu Dhabi, and Standard Chartered Bank led the sale.

Qatar National Bank is reportedly seeking a US$1bn 3-year syndicated loan from lenders based in Asia, according to Reuters. Agricultural Bank of China is said to be taking a leading role on the transaction.

Saudi Basic Industries Corp. (Sabic) is currently in initial talks to secure a US$2bn loan from a range of regional and international lenders, sources with knowledge of the deal said.

Turkey hit the market this week with a US$2bn senior unsecured bond paying a coupon of 6% and priced at 98.858%. Barclays, Citigroup, Goldman Sachs, and Qatar National Bank were bookrunners on the deal.

The tender process has commenced for a series of infrastructure projects in Turkey, including roads and a bridge that spans the Dardanelles waterway, worth approximately US$5bn. Construction on the bridge, which was designed by Tefken Holding, is expected to commence in March 2017 and be built between Sütlüce and Gelibolu, about 200km from Istanbul. It will form part of the Kınalı-Tekirdağ-Çanakkale-Balıkesir highway project.



S&P Global Ratings affirmed the "B-" Local Currency LT credit rating of Mozambique, and in a surprise move, revised the outlook on the country to 'stable' from 'negative'. The move comes as Mozambique nears a default on its infamous 'Tuna Bonds'

Nigeria raised NGN214.95bn (US$704.18mn) in local currency bonds at its first auction this year, the country's DMO said. The auction was well-bid, and received subscriptions of NGN235bn. At 16.89% to 16.99%, yields on the notes are, impressively, below inflation – which currently sits at roughly 18.5%.



The Republic of Colombia sold US$1bn in 10-year Eurobonds this week, carrying a coupon of 3.875%. The notes were priced at 98.596%. The sovereign is also looking to retap its 2045s. Citi, Itau Unibanco Holdings, and Morgan Stanley managed the trade.

The Dominican Republic priced US$1.2bn in 2027 bonds paying a coupon of 5.95%, tightening slightly from IPTs, and sold at par. JP Morgan was the sole lead on the deal.

Colombia's Central America Bottling Corporation (CBC) is organising roadshows this week ahead of a possible 144A/RegS transaction.

Chile's Empresa Metro successfully sold US$500mn in 30-year notes yielding 5% and priced at 97.706%. Bank of America Merrill Lynch and JP Morgan managed the trade.

Brazilian President Michel Temer has said the government is set to introduce a series of tax reforms that will include pension reform.

Brazilian aerospace company Embraer has mandated BB Securities, JP Morgan and Santander ahead of a US dollar denominated 10-year bond that could launch before the end of the month.



Russian state development bank Vnesheconombank (VEB) may look to tap the international capital markets in 2017, and will not rule out entering European credit markets if Western sanctions are lifted, the bank's CEO said in an interview with Rossiya 24 this week. VEB last hit international debt markets in July 2016.

Russia's Alfa-bank set the first coupon rate at 9.45% for its new RUB5.0bn 3-year putable bonds after early bookbuilding, the bank said in a statement.

United Company Rusal has hired banks to arrange series of fixed income investor meetings ahead of a possible debut 5-year US dollar bond.

Azerbaijan’s economy contracted 3.8% last year, according to the country's State Statistics Committee. This comes after a gain of 1.1% in 2015. The shortfall largely stems from severe government cuts to infrastructure development, which saw a significant contraction in the construction sector.

Agrokor D.D. has announced it will terminate the syndication of a €100mn 3-year term loan facility, a process that began in September last year. Reports suggest the company was struggling to attract lenders to the deal.



China Huarong Asset Management (AMC) raised US$1.1bn in bonds maturing in 2020. The bonds carry a coupon of 3.375% and were priced at 99.622%. AMTD Asset Management Limited, Bank of China, Bank of Communications, CCB International, China Minsheng Banking, China Securities (International) Finance, Commerzbank, Credit Suisse, Goldman Sachs, Haitong International securities, HSBC, China Huarong Asset Management, ICBC, JP Morgan, Morgan Stanley, Shanghai Pudong Development Bank, Standard Chartered Bank, and Wing Lung were bookrunners on the trade. The move comes just days after the company's subsidiary, Huarong Ruitong Equity Investment Management Co., announced it would raise US$7.2bn for a fund used for debt-to-equity swaps.

China-based property developer Yuzhou Properties raised US$350mn in 5-year bonds carrying a coupon of 6% and sold at 99.575%. AMTD Asset Management Limited, Bank of China, China Galaxy International Securities, Citigroup, Credit Suisse, Deutsche Bank, Haitong International Securities, and Zhongtai International Securities were bookrunners on the trade.

Chinese property operations firm Beijing Capital Land raised US$400mn in bonds maturing in 2020. The notes carry a coupon of 3.85% and were priced at 99.72%. ANZ, CITIC Securities International, CMB International Capital Corporation, Deutsche Bank, and ICBC were bookrunners on the deal.

Indonesia’s anti-corruption agency named Emirsyah Satar, ex-CEO of PT Garuda Indonesia, as a suspect in an international bribery case. The agency is investigating the bribery case linked to parties in several countries in Asia and Europe, spokesman Febri Diansyah said.

A new report from Standard Chartered estimates capital flows out of China totalled almost US$730bn in 2016, a near-record level. Analysts Shuang Ding and Lan Shen estimate outflows had moderated in December to US$66bn, down from November’s US$75bn.

China’s holdings of US Treasuries declined by US$66.4bn in November, the sixth straight decline as the country continues to offload its holding of US debt.

The Export–Import Bank of Korea (KEXIM) priced a US$500mn 5-year bond at 3M LIBOR USD + 0.875% this week. Daiwa Securities, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan, Standard Chartered Bank were bookrunners on the bond.

Malaysia’s Central Bank kept its benchmark interest rate unchanged for a third straight meeting to help bolster the currency as policymakers in emerging economies prepare for tighter U.S. monetary policy. Bank Negara Malaysia held its key rate at 3%, it said in a statement in Kuala Lumpur Thursday.

In Malaysia this week, GOHL Capital Ltd, a subsidiary of Genting Bhd, sold US$1bn in 10- year notes priced at UST+181bp at a price of 99.597 to yield 4.30%. The notes are due to list on the Stock Exchange of Hong Kong Ltd at the end of the month.

The Philippines completed its debut international capital markets transaction this week when it sold US$2bn in bonds maturing in 2042. The bonds carry a 3.7% coupon and were sold at par. Citigroup, Credit Suisse, Deutsche Bank, Standard Chartered Bank, and UBS lead the trade.

The Philippine peso, which weakened 4.6%, in the past 12 months, is tipped by Bloomberg to be most resilient to external risks this year among Asian currencies. The Thai baht and Indian rupee together rank second, while China’s yuan is last.

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