Zenit oversubscription helps lift mood in Russian FI mart
The response to the loan for Russia’s Bank Zenit, which was signed this week for an increased amount, showed again that for the right names and with the right pricing, the loan market is still more than accessible for financial institutions in eastern Europe.
Banks were signed into the $218m facility, after it was oversubscribed and increased from $150m.
Bankers close to the loan for Bank Zenit, which was led by BayernLB, Commerzbank, Erste Bank, Landesbank Berlin and RZB, said that it had been a "good combination of the timing of the deal, and the right price" which had led to its success.
"There were no other big deals for financial institutions at the same time, which helped," said one official. "Zenit has the same kind of ratings as other banks that have done well in the market this year, like Akbars Bank and Nomos Bank, and it is that top 15-20 range of banks in Russia that we are quite confident can access the market."
The deal raised $118m from the market, while the mandated lead arrangers provided $100m. About 20 banks joined the facility.
The one year loan paid a margin of 145bp over Libor, but the all-in pricing for the top ticket on offer was 290bp. The smallest ticket paid fees of 100bp.
Like other deals for Russian banks’ which have been launched into syndication recently, Bank Zenit paid up on the margins and on the fees. Borrowers have so far been reluctant to increase the initial margin by too much, preferring instead to pile on the fees without disclosing them.
"For investors, it is the all-in pricing which is important," said one lender, "having a high margin which reflected the risk is good, but isn’t essential if the fees make up for it."
Other bank borrowers in the region are expected to reap good results, such as Ursa Bank, which is in the market for $50m, in a deal led by Calyon, ICICI Bank, ING and RZB.
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Rusal mandates StanChart
Russian aluminium company United Company Rusal has mandated Standard Chartered to arrange a facility of up to $250m in connection with the development of the Aluminium Smelter Company of Nigeria (Alscon). The deal, which is still in the early stages, could come to market this year.
Rusal acquired a majority stake in Alscon in February, and has since embarked on a modernisation programme of the smelter, where production had been at a standstill since 2000 — it is now back in action, and the first 1,000 tonnes of aluminium under Rusal’s ownership were produced at the Alscon smelter earlier this month.
Rusal announced in February that it would be looking to invest about $300m to further modernise the plant.
The potential debt financing would be drawn down this year, and would have a tenor of between seven and 10 years. |
