Middle East & Turkey
Kuwaiti lender Warba Bank sold US$250mn in 5-year notes yielding MS+437.4bp. The notes were sold at par, and the sale was arranged by Bank ABC, Emirates NBD, KAMCO, KFH Capital Investment Company, Noor Bank, and Standard Chartered Bank.
Oman's Central Bank plans to raise OMR450mn this year to help finance the deficit and repay existing maturities. The Central Bank has already issued OMR150mn in bonds this year, while the government recently raised about US$5bn from international markets.
Saudi Arabia's Minister of Energy, Industry and Mineral Resources Khalid Al-Falih has called out other oil producers this week for not shouldering enough of the oil cut agreed to under a plan with OPEC and non-OPEC producers. Since January, the GCC country lowered its output by 1.2 million barrels per day, far more than any other producer linked to the deal. “We will not bear the burden for free riders this time. Saudi Arabia will not allow itself to be used by others. This is for the benefit of all,” he told press this week.
Kuwait's inaugural international bond issuance is likely to price somewhere between similar sovereign issuances from Abu Dhabi and Qatar, Reuters reported citing GCC-focused investors. Depending on the size and tenor, investors think the bonds could price anywhere between 2.39% and 2.69%.
Turkey's Akbank has set initial price thoughts of the 7.5% region for a Tier 2 benchmark sized bond. The US$500mn 10NC5 capital boosting notes are likely to price this week. The deal is being managed by Bank of America Merrill Lynch, Citi, Goldman Sachs International, HSBC, Societe Generale, and Standard Chartered.
Kenya's National Treasury confirmed this week that plans to secure a US$750mn loan (approx. KES76.98bn) from a syndicate of lenders is still going ahead. In January, the Department picked Citi, Rand Merchant Bank, Standard Bank, and Standard Chartered to arrange the loan, but Reuters earlier this month reported that the loan was being delayed.
MTN Group has approached investors to gage interest for a possible rand-denominated bond, according to data from Bloomberg. The telco could look to raise as much as US$300mn equivalent. The company last raised debt in the international markets last year, selling US$1bn in bonds and raising an additional US$1bn through a syndicated loan.
Nigeria's Debt Management Office (DMO) said it plans to raise an additional NGN130bn (approx. US$427mn) in fresh bonds March 15, the country's third debt sale this year. The DMO said it will sell NGN45bn in notes due in 2021, NGN50bn in notes due in 2027, and NGN35bn in notes due 2036. The notes will be sold by Dutch auction. The move comes as the sovereign looks to potentially tap the international markets for another Eurobond sale, following its hugely successful US$1bn bond sale in February.
Burundi-based Eastern and Southern African Trade and Development Bank, known colloquially as PTA Bank, raised US$500mn from the international capital markets this week. The notes maturing 2022 priced at 99.46% to yield 5.51%. Commerzbank, Mitsubishi UFJ Financial Group, and Standard Chartered Bank managed the sale.
Brazil has sold US$1bn in a re-tap of bonds maturing 2026 at a yield of 5%. The notes were initially issued one year ago at 6%, signalling an impressive tightening in pricing as a number of Brazilian corporates boost their capital markets activity. The sale was arranged by Citi, Bank of America Merrill Lynch, and BNP Paribas.
Peru's Central Bank meets Thursday and is expected to keep rates steady at 4.25%, with modest CPI pressure unlikely to cause substantial concerns among the Bank's board. Analysts suspect inflation moved to 3.3% in February, up from 3.1% in January.
Brazilian conglomerate Andrade Gutierrez SA has cancelled a planned BRL645mn debenture sale. The sale was cancelled in line with the company's bid to reduce its capital needs by approximately BRL800mn, the company said in a note to the country's capital markets regulator.
A trade dispute between Mexico and the US is starting to heat up as Mexico cancelled existing sugar export permits to the country this week, according to Reuters. Mexico is currently the largest supplier of sugar to the US, sending up to 970,000 tons north of the border every year. A letter seen by the news agency suggests unfilled positions at the US Department of Commerce left Mexican officials with nobody to negotiate with on the permits' renewal.
China posted a trade deficit in February as a construction boom combined with the lunar new year holiday created US$8.79bn imbalance in a country that usually posts trade surpluses. Imports surged 44.7% in February year on year, while exports climbed just 4.2% according to government data.
SME lender China Opportunity International Ltd hit the market this week for a US$632mn bond due 2018. The notes were priced at par to yield 2.05%. Bank of China and Standard Chartered Bank mandated the sale.
China Exim Bank hit the international markets this week for a triple-tranche dual-currency bond this week. The lender sold a €1bn 2020 tranche at 99.97% to yield 0.26%, a US$1.15bn 2022 tranche at 98.77% to yield 2.89%, and a US$850mn 2027 tranche at 98.009% to yield 3.65%. Bank of China, Bank of Communications, Barclays, Credit Agricole CIB, ING Wholesale Banking London, KGI Securities, Mitsubishi UFJ Financial Group, and Westpac Banking managed the sale.
Singapore-based commodities trader Noble Group raised US$750mn through the sale of notes maturing in 2022. The notes were priced at par to yield 8.75%. HSBC, ING Wholesale Banking London, Morgan Stanley, and Societe Generale managed the sale.
The Export-Import Bank of Korea (Kexim) hit the yuan market this week for a CNY200mn bond sale with the notes maturing in 2022. The notes were sold at par to yield 5.535%. Standard Chartered Bank was the sold arranger on the deal.
RAM Ratings has suspended the rating of Al Bayan Holding Company's MYR1bn sukuk due 2023. In December, the company failed to redeem MYR100mn to bondholders, with the maturity extended to June 2017. The rating agency said it was unable to successfully contact members of the company.
The Central Bank of India was the latest commercial bank in India to have its bonds downgraded as rating agencies increasingly factor new Basel III thresholds into their asset quality assessments. India's ICRA downgraded the bank's Tier II bonds from 'AA-' to 'A+', citing weaker asset quality. "Given the large quantum of immediate as well as future capital requirements under Basel III regulations and relatively weak position in terms of ability to raise the capital, the outlook has been retained as negative," the rating agency said. The move comes just one week after IDBI bank, another large commercial lender in India, had its debt downgraded.
Russia, CIS and Europe
Russia’s FX reserves includes gold and currency increased by US$6.74bn to just over US$397bn in February, data from the country’s Central Bank show. Excluding gold, FX reserves rose to just over US$330bn, a two-year high.