Brazilian, Korean, Philippines banks price deals; markets skittish as high yield bid fades

By Paul A. Harris

St. Louis, Feb. 1 - The emerging markets were a little skittish on Monday, according to a syndicate banker in New York who spoke an hour after the close.

The bid for high-yield paper is fading, the banker commented, adding that interest is shifting toward investment-grade emerging markets sovereigns and corporates.

Brazil's five-year CDS were at 138.25 basis points mid during the European afternoon, 1.75 bps tighter.

Russian five-year CDS were at 189.125 bps mid, 2.75 bps wider.

Industrial Bank of Korea prices

The financial sector loomed large during Monday's primary market activity.

Among the day's deals, Industrial Bank of Korea priced a $350 million issue of 4 3/8% 5.5-year senior unsecured notes (A2/A/A+) at a 205 basis points spread to Treasuries.

The spread came on top of the price talk.

The notes sold at a reoffer price of 99.734, resulting in a yield of 4.43%.

Deutsche Bank, HSBC and Goldman Sachs & Co. were joint bookrunners for the Regulation S issue.

Rizal comes tight to talk

Also Tuesday, Rizal Commercial Banking Corp. of the Philippines priced a $250 million issue of five-year senior notes at par to yield 6¼%.

The yield printed at the tight end of the 6¼% to 6 3/8% price talk.

Citigroup and Standard Chartered Bank were joint bookrunners for the Regulation S issue.

Banco Pine prices $125 million

Brazil's Banco Pine SA priced a $125 million issue of 8¾% seven-year Tier 2 fixed-rate notes (Ba3) at 98.748 to yield 9%.

The Rule 144A and Regulation S offering was led by joint bookrunners HSBC, Credit Suisse and Banco Espirito Santo.

Proceeds will be used to increase the bank's capital base to allow credit portfolio growth, and for general corporate purposes.

Asian Development Bank for Tuesday

Asian Development Bank set price talk for a benchmark dollar-denominated offering of five-year notes at a 2 bps spread to mid-swaps, an informed source said Monday.

The deal is expected to price on Tuesday in Asia.

Bank of America Merrill Lynch, Morgan Stanley, RBC Capital Markets and UBS are leading the transaction for the Manila, Philippines-based regional development bank.

Chandra Asri on the road

Indonesian petrochemical firm, PT Chandra Asri is expected to price a $230 million offering of five-year guaranteed secured and senior notes (B2/B+) early in the week of Feb. 8.

DBS Bank Ltd., Deutsche Bank Securities and Standard Chartered Bank are leading the offering, which is being marketed via Rule 144A and Regulation S.

Timing could be accelerated, according to a market source.

The notes, which will be issued via Altus Capital Pte. Ltd., come with three years of call protection. If they are not called, the notes will amortize at the rate of 16.67% of the principal after each of 3.5 years, four years and 4.5 years.

Proceeds will be used to refinance debt.

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