CBM has placed USD 600 mln Eurobonds at record-low rate
Not for release, publication or distribution, directly or indirectly, in whole or in part, in or into the United States of America (except to qualified institutional buyers, as defined in Rule 144A under the US Securities Act of 1933 (the “Securities Act”) that are also qualified purchasers as defined in section 2(a)(51) of the US Investment Company Act of 1940), Australia, Canada, Japan or any other jurisdiction where to do so would be unlawful. This announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States or in any other jurisdiction.
Credit Bank of Moscow (CBM) has become the first Russian bank to issue Eurobonds in 2020. On 22 January 2020, CBM successfully closed the book of orders for its new senior 5-year USD 600 mln 4.7% Eurobond issue.
The coupon rate on this issue became the lowest in the Bank’s Eurobond market history and among all 5-year USD-denominated Eurobonds issued by Russian & CIS privately-owned banks.
The book-building process was preceded by a series of meetings with international investors in Zurich, Geneva, Frankfurt, Vienna, London, Boston, New York, Hong Kong and Singapore. Furthermore, pursuant to its investor diversification strategy, CBM has become the first Russian issuer to tap the Middle East region: a series of meetings took place in the emirates of Dubai and Abu Dhabi.
The strongest interest was shown by investors from Continental Europe (34%). The wide international demand was underpinned by investors from the USA (20%), the UK (15%), and Southeast Asia and Middle East (9%). The share of Russian investors is 22%. In total, more than 180 orders were received from investors from 23 countries globally.
As the deal was oversubscribed, with the order book exceeding USD 1.6 bln at the last update, the coupon rate was lowered by more than 0.55% against the upper notch of the initial price guidance. The final coupon was fixed at 4.7%. Seeing investors’ enthusiasm about the transaction, it was upsized from USD 500,000,000 to USD 600,000,000.
"Another Eurobond issue by CBM has met a high demand from international investors. The current placement lowered the Bank's dollar Eurobond yield curve and marked further diversification of our investor base: we have seen growing activity of investors from Southeast Asia and Middle East, whose demand for our bonds was at an all-time high for a Russian issuer. This is a result of our successful work in terms of investor relations in these regions. We are satisfied with the results of our placement and how the bank was perceived by the international investment community," commented Vladimir Chubar, Chairman of the Management Board.
The bonds are to be issued under Rule 144A and Regulation S. The Eurobond is expected to be rated "BB" by Fitch Ratings and "BB-" by Standard & Poor’s.
Citi, ING, Societe Generale and UBS Investment Bank acted as global coordinators, while Commerzbank, Emirates NBD Capital, Raiffeisen Bank International and Sova Capital acted as joint lead managers and bookrunners.
It is CBM’s third issue of Eurobonds in the last 12 months. CBM currently has seven outstanding Eurobond issues: five issues with a total outstanding principal of USD 2.5 bln, one EUR 500 mln issue and one RUB 5 bln issue.
The securities to which this announcement relates have not been and will not be registered under the Securities Act and may not be offered or sold in the United States or to, or for the account or benefit of, us persons (as such term is defined in Regulation S under the Securities Act), except pursuant to registration or an exemption from the registration requirements of the Securities Act. There will be no public offer of securities in the United States.
This announcement does not constitute or form part of an offer or invitation to sell or issue, or any solicitation of an offer to buy or subscribe for, any securities, in the United States or any other jurisdiction nor shall it (or any part of this announcement) or the fact of its distribution form the basis of, or be relied upon in connection with, or act as any inducement to enter into, any contract or commitment or investment decision whatsoever. The distribution of this announcement in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
Recipients of this announcement who intend to purchase any securities in the future are reminded that any such purchase or subscription must be made solely on the basis of the information contained in any final form prospectus published in connection with any such securities. This announcement is not being made, and this announcement has not been approved, by an authorised person for the purposes of Section 21 Financial Services and Markets Act 2000, as amended (the “FSMA”). This announcement is not being distributed to, and must not be passed on to, the general public in the United Kingdom or to persons in the United Kingdom save in the circumstances where Section 21(1) of the FSMA does not apply. This announcement is directed only at persons who (i) are outside the United Kingdom or (ii) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) order 2005 (the "Order") or (iii) are persons falling within article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc") of the order or (iv) to whom this announcement may otherwise be directed without contravention of Section 21 of the Financial Services and Markets Act 2000 (all such persons together being referred to as "Relevant Persons"). This announcement must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this announcement relates is available only to Relevant Persons and will be engaged in only with Relevant Persons. This communication is not intended for distribution to and must not be passed on to any retail client.
This announcement or information contained therein is not an offer, or an invitation to make offers, to sell, exchange or otherwise transfer securities in the Russian Federation to or for the benefit of any Russian person or entity and does not constitute an advertisement or offering of securities in the Russian Federation within the meaning of Russian securities laws. Information contained in this announcement is not intended for any persons in the Russian Federation who are not "qualified investors" within the meaning of article 51.2 of the Federal Law No. 39-FZ "On the Securities Market" dated 22 April 1996, as amended (the “Russian QIS”) and must not be distributed or circulated into Russia or made available in Russia to any persons who are not Russian QIS, unless and to the extent they are otherwise permitted to access such information under Russian law. The securities referred to herein have not been and will not be registered in Russia and are not intended for “placement” or “circulation” in Russia (each as defined in Russian securities laws) unless and to the extent otherwise permitted under Russian law.
In member states of the European Economic Area, this announcement is directed only at persons who are "qualified investors" within the meaning of article 2(e) of Regulation (EU) 2017/1129 of the European Parliament and of the Council dated 14 June 2017 (as amended, the “Prospectus Regulation") ("Qualified Investors"). This announcement is an advertisement for the purposes of applicable measures implementing the Prospectus Regulation. A prospectus prepared pursuant to the Prospectus Regulation will be published, which, when published, can be obtained from the trustee.
A rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time by the assigning rating organisation. Similar ratings for different types of issuers and on different types of securities do not necessarily mean the same thing. The significance of each rating should be analysed independently from any other rating.