VTB Capital was the joint organiser of the issue of Vnesheconombank (VEB) bonds. The issue totalled $600m, with a coupon rate of 4.9% per annum and maturity of five years.
Although the issue is denominated in US dollars, settlement will be made in roubles, which is typical for a flotation such as this. The new structure of this bond issue attracted high demand from the market, with more than 70 applications. In the process of marketing the loan, the guide price was lowered three times and the size of the issue increased to $600m, from the $300-500m initially proposed.
Alexey Konochkin, Deputy Head of the Debt Capital Markets Department of VTB Capital, said: “The demand for VEB’s bonds exceeded one billion dollars. Russian banks and investment companies were the principle investors, but a number of individuals also showed an interest in this bond issue. We expect various Russian lenders to be interested in deals like this one, especially those who are currently restricted in their direct access to foreign markets.”
The flotation of the VEB bond issue goes on general sale on the Moscow Stock Market on 21 July 2016.
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