Eurasian Development Bank could offer $500 mln in Eurobonds in fall

Aug 25. Interfax. ALMATY

Eurasian Development Bank could offer $500 mln in Eurobonds in fallThe Eurasian Development Bank (EDB) is planning  to  offer  $500  million  in Eurobonds in September-October, a senior bank official told reporters in Almaty.

“We’re looking to place in September, or October at the latest, and for now  we’re talking about $500 million,” said Yevgeny Vinokurov, head of economic analysis and consulting at the bank.

He said “due diligence for the Eurobonds was performed last week.”

“It’s  not as if the international market has thrown its doors wide open for  first-rate  borrowers,  but a small window is now open. Nearly all first-class  Russian  borrowers,  including  Gazprom  and Lukoil, have placed in the last two or three months, and the EBD ranks among such borrowers,” Vinokurov said.

The bank has a high rating, conservative liquidity management, well structured  projects  portfolio  and  sufficiently  high  level  of risk management, he said.

The  EDB  delayed  a  planned debut $300 million Eurobond placement indefinitely last year due to the financial markets uncertainty.

The  EDB said last week that it was preparing four bond issues each worth 5  billion  rubles  and each maturing in seven years. This will be the bank’s first placement on the Russian market.

In  April  and July of this year, the bank placed two bond tranches on the Kazakh  debt  market, which were denominated in tenge coming to a total of  20  billion tenge (around $133 million). The funds raised from the placement will be invested in infrastructure projects for the Kazakh economy.

Russia  and Kazakhstan established the EDB in 2006 with the purpose of facilitating  the robust development of the two countries’ economies, sustaining  high  rates  of  economic  growth,  expanding  mutual trade, developing  other  forms  of  economic relations, and encouraging direct investment, including on the basis of private-public partnership.

Russia’s  contribution  to  the  bank’s  equity was $1 billion, and Kazakhstan  paid  in  $500  million.  In December 2008, the EDB accepted Tajikistan,  Belarus and Armenia as members. At the start of April 2009, Armenia  made an equity contribution of $100,000 to the bank. At the end of June  2009,  the bank announced that Tajikistan had completed all the necessary  measures  for entry into the EDB and invested $500,000 in the bank.