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CBM announces successful completion of a series of capital market transactions

07.04.2020

On 20 March 2020, CBM partially cancelled four issues of its senior Eurobonds due 2021-2024 on the total amount of USD 400 mln and EUR 100 mln to proactively manage its liabilities and reduce regulatory pressure from the stated securities on capital adequacy ratios (in accordance with Russian accounting standards). The cancellation of previously repurchased senior Eurobonds is expected to add c. 0.3 pp to the N1.1 core capital adequacy ratio compared to 1 March 2020.

By the time of cancellation, the aggregate principal of the Eurobonds bought back and held on the bank’s book was USD 434 mln and EUR 123 mln. Those Eurobonds were used as part of CBM's treasury and liquidity management functions together with certain other instruments in its securities portfolio. The bank intends to hold the non-cancelled Eurobonds for its own account and may sell or cancel them in the future.

In parallel with the partial cancellation, CBM also announced a modified Dutch auction (MDA) targeting five series of senior notes with maturities ranging from 2021 to 2025, and an aggregate principal outstanding amount of USD 2.1 bln. The received tenders totalled USD 198 mln, close to the USD 200 mln maximum acceptance amount. The bank decided to accept the cheapest portion of offers. As a result, the bank bought back c. USD 88 mln (at nominal values) of the above-mentioned Eurobonds and locked in a profit, which exceeded RUB 1 bln.

CBM currently has eight outstanding Eurobond issues: six issues with a total outstanding principal of USD 2.6 bln, one EUR 367 mln issue and one RUB 5 bln issue.

Providing liquidity to the market and supporting its debt instruments in the secondary market in times of volatility will remain an important priority of the bank.