Issuance from Vakifbank; trading slows down ahead of Fed meeting; Poland’s BGK preps deal

By Christine Van Dusen

Atlanta, April 25 – Turkey’s Turkiye Vakiflar Bankasi TAO (Vakifbank) was among the issuers to sell new notes on a quieter Tuesday that saw emerging markets investors awaiting the outcome of the Federal Reserve’s meeting.

“With a lack of economic events and little news flow outside of Saudi Arabia, [emerging markets] investors yesterday had a busy day in primary markets instead,” a trader said. “Looking ahead today, the Fed will gather for its two-day monetary policy meeting.”

From Latin America, inquiry and volumes picked up as Tuesday went on – but not markedly, a New York-based trader said.

“Seems like the breadth of credits being traded is pretty thin,” he said. “The credits that are trading more frequently comprise only a handful.”

In that handful were names like Brazil-based Gerdau SA and Colombia’s Ecopetrol SA.

Brazil-based Vale SA “is quiet, and close to unchanged,” he said.

Even the Mexico-based Sigma Alimentos SA de CV’s new $1 billion 4¼% notes due May 2, 2026 that priced Monday at 99.797 to yield Treasuries plus 225 basis points were “pretty quiet,” he said.

The notes were talked at a spread in the 262.5 bps area.

BofA Merrill Lynch and JPMorgan were the active bookrunners for the Rule 144A and Regulation S deal. MUFG Securities and Rabo Securities were the passive bookrunners.

“Once again, overall, we remain pretty firm,” he said. “Some areas are drifting lower, like Mexican banks.”

But there was no heavy selling, he said.

Bonds from Mexico-based Cemex SAB de CV continued to perform, he said, with both the 2025s and 2026s better bid.

Lat-Am drifts lower

At the end of the session, cash prices for Latin American bonds drifted lower “in sympathy with weaker U.S. Treasuries, despite a touch of spread tightening,” a trader said.

Flows were “very subdued for the session, with two-way inquiry,” he said. “Markets have entered a bit of a consolidation phase since mid-to-late last week. All eyes will be on the Fed tomorrow, so volatility should remain tamed until mid afternoon.”

Sinopec trades

The new four-tranche issue of notes due in three, five, 10 and 30 years from China Petroleum & Chemical Corp. (Sinopec) got some attention in the secondary market on Tuesday.

The $1 billion 2 1/8% notes due May 3, 2019 that priced Monday at 99.752 to yield Treasuries plus 120 bps traded Tuesday at 116 bps bid, 114 bps offered.

The $900 million 2¾% notes due May 3, 2021 that priced at 99.815 to yield Treasuries plus 142.5 bps traded at 138 bpd bid, 134 bps offered.

The $700 million 3½% notes due May 3, 2026 that priced at 99.166 to yield Treasuries plus 170 bps traded at 175 bps bid, 171 bps offered.

And the $400 million 4¼% notes due May 3, 2046 that priced at par to yield 4¼% priced at 4.28% bid, 4.22% offered.

Citigroup, Goldman Sachs, Bank of China, HSBC and JPMorgan were the joint global coordinators for the Rule 144A and Regulation S deal.

The proceeds will be used to refinance existing indebtedness.

Ziraat Bank moves higher

Turkey-based Turkiye Cumhuriyeti Ziraat Bankasy AS’ (Ziraat Bank) new $500 million 4¾% notes due 2021 that priced at 99.701 on Monday to yield mid-swaps plus 350 bps saw some activity in trading on Tuesday, a trader said.

The notes were spotted at 100.38 bid, 100.46 offered.

Barclays, Goldman Sachs, Mizuho Securities, Societe Generale and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

The deal attracted a final order book of almost $2 billion from more than 150 accounts, a market source said.

Vakifbank prices notes

In its new deal, Turkey’s Vakifbank sold €500 million 2 3/8% notes due May 4, 2021 at 99.059 to yield mid-swaps plus 250 bps, a market source said.

Barclays, BNP Paribas, Erste Group, Natixis and UniCredit were the bookrunners for the Regulation S deal.

Fantasia prints bonds

China’s Fantasia Holdings Group Co. Ltd. sold RMB 600 million 9½% notes due May 4, 2019 at par to yield 9½%, a market source said.

Guotai Junan International and BofA Merrill Lynch were the bookrunners for the Regulation S deal.

The proceeds will be used to refinance existing debt.

Fantasia Holdings is a property development company based in Shenzhen, China.

Gruposura sets talk

Colombia’s Grupo de Inversiones Suramericana SA set final talk in the 5¾% area for a $540 million issue of 10-year notes, a market source said.

The notes were initially talked at a yield in the 6% area.

BofA Merrill Lynch and JPMorgan are the bookrunners for the Rule 144A and Regulation S deal.

The notes will be issued via Gruposura Finance and guaranteed by Grupo de Inversiones Suramericana.

The proceeds will be used to pay existing bank indebtedness and for general corporate purposes.

The issuer is an investment company based in Medellin.

BGK finishes roadshow

Poland’s Bank Gospodarstwa Krajowego (BGK) on Tuesday concluded a roadshow for a debut issue of euro-denominated notes, a market source said.

BNP Paribas, HSBC and Societe Generale CIB are the bookrunners for the Regulation S deal.

The deal will be guaranteed by the State Treasury of the Republic of Poland.

The bank is based in Warsaw.

© 2015 Prospect News.
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