Russia & CIS

CASE STUDY: Lukoil Cuts Through Turbulence and Dysfunctional Oil Market with USD1.5bn Bond Issuance

In spite of the turmoil seen in credit and oil markets in recent months, Lukoil, one of the largest publicly traded oil & gas companies in the world with operations in over 30 countries, was able to issue a competitively-priced USD1.5bn benchmark Regs/144a bond.

15 May 2020

Ukraine Finally Passes Banking Reforms, Clearing a Path for IMF Bailout

Ukraine passed an amendment to its banking rules this week that would prevent insolvent banks from being returned to their previous owners, potentially unlocking billions of dollars in support from the IMF and other multilateral institutions.

14 May 2020

Foreign Investors Flock Back into Government Bonds as Russia’s Central Bank Ponders Rate Cut

Though down from the levels seen in early March, the share of foreign investors in Russian sovereign bonds stayed above 30% as juicy yields, calming global markets and a dovish outlook at the CBR attracted foreign buyers.

20 Apr 2020

Excessive Dollarization, Concentration of Loans to State-Owned Enterprises Key Risks for Uzbek Lenders as Privatisations Loom

Concerns over excessive dollarization and a high concentration of loans to state-owned enterprises, many of which were offered at preferential rates, could weigh on Uzbekistan’s banking sector and throw privatisations into question in the face of record global market turbulence.

16 Apr 2020

Eurochem Scraps Eurobond in Favour of New Rouble-Denominated Issuance

The company was forced to pull its latest international bond issuance after a roadshow in London as market sentiment deteriorated rapidly, and is now seeking to tap the rouble market instead.

14 Apr 2020

Sovcombank Launches Debt Buyback, Signalling Broader Shift to Liability Management as Sector Outlook Dims

One of Russia’s largest lenders joins a growing list of banks carrying out liability management exercises amid growing pressure on the sector from the COVID-19 pandemic, as Fitch Ratings shifts sector outlook to negative.

8 Apr 2020

Russian Regions Squeezed by Rising Borrowing Needs, Soaring Debt Costs

Over the past two years the sub-sovereign bond market has been largely stagnant, but as budgetary constraints force regional issuers to tap the bond markets, rising costs of debt will act as an impediment.

8 Apr 2020

Russian Banks Come Under Pressure as Kremlin Tweaks Taxes to Support Pandemic-Hit Economy

The Russian government introduced sweeping changes to the tax regime in order to support businesses and SMEs, while seeking to secure additional revenue streams elsewhere. But while the country’s ample FX reserves should see it fare better than many EM peers, its banking sector – subject to a massive and prolonged consolidation over the past five years – is also feeling the squeeze.

27 Mar 2020

Kazakhstan Bucks Trend as Other Central Banks Follow US Fed in Slashing Rates

Central Asian republics have scrambled to raise rates as their currencies plummeted following a double blow from COVID-related market turmoil and a collapse in the oil price.

17 Mar 2020

CASE STUDY: Russian Railways Rides Through Volatility with Record-Breaking CHF250mn Green Bond

The issuer “boarded the last train” as EM bonds plummeted on the back of coronavirus-related fears, securing the tightest pricing for any Russian corporate issuing in the swiss franc market.

13 Mar 2020

Non-Resident Share in OFZs Rises in March as Russia Suspends Upcoming Auctions Amid Sell-Off

The share of non-resident investors holding the Russian Treasury’s rouble-bonds (OFZs) has reached 34.1% this month, up from 33.2% at the start of February, according to data published by the Russian Central Bank.

13 Mar 2020

Russian Railways “Catch the Last Train” with Record-Setting Swiss Franc Green Bond

The new 6-year notes, part of RZD’s green bond programme, priced at a stunning 0.84% just as global markets began shutting down due to coronavirus-related shocks.

11 Mar 2020

Russia’s GTLK Braves Market Volatility to Issue USD600mn Eurobond

The issuance came at a significant premium and questions have been raised about the timing, as a 50bp Fed rate cut arrived shortly after the placement.

5 Mar 2020

Russian Government Issuance Surged in 2019, RUB and Hard Currency Bond Yields Diverge

Demand for government notes grew 1.5x from 2018, but was outpaced by more than 3x increase in supply, according to official state figures.

4 Mar 2020

IMF Marks “Good Progress” in Ukraine Visit, but More Reforms Needed

The International Monetary Fund said this week that it had made good progress in talks with the Ukrainian authorities over the approval for a new loan programme to Ukraine worth USD5.5bn but its disbursement depends on Kiev’s performance on reforms, including a special law on banking.

3 Mar 2020

Risk of Oil Price Collapse ‘High’ as Russia Urges Caution on OPEC+ Action - Standard Chartered

Russia’s slowness to respond to a fall in demand for oil following the coronavirus outbreak could send oil prices plummeting to as low as USD30 per barrel, according to analysts at Standard Chartered Bank.

2 Mar 2020

Sberbank Net 2019 Profits Surge Following Denizbank Sale

Russia’s biggest lender posted a 20% y-o-y jump in profits for 4Q2019, as it prepares for the looming change of the controlling shareholder.

27 Feb 2020

Regulatory Tweak Could Boost Russian Corporate Green Loans Pipeline

A new mechanism to compensate for the “green premium” on loans could incentivise businesses to tap the nascent market.

26 Feb 2020

Russian Government Reshuffle Spreads to MinFin as Another Key Minister Set to Leave

Storchak, a veteran of the finance ministry is expected to resign in coming days, according to state media reports.

18 Feb 2020

Russia Sovereign Wealth Fund to Buy Out Central Bank Stake in Sberbank

The move is expected to ease concerns about the potential conflict of interest (regarding the CBR’s partial ownership of Russia’s biggest bank) and should provide additional funds for the “January Revolution” of additional social spending announced by President Putin at the start of this year.

17 Feb 2020