Turk Eximbank prints notes; Saudi Arabia sets talk; Jordan on deck; Kuveyt Turk plans roadshow

By Christine Van Dusen

Atlanta, Oct. 18 – Turkey’s Export Credit Bank of Turkey SA (Turk Eximbank) sold notes on Tuesday as investors awaited the new deal from Saudi Arabia, which released guidance, and kept an eye on Jordan.

“EM has certainly benefitted from a strong momentum in the third quarter, but sentiment has recently become slightly more sluggish as central bank actions, political events and a busy EM pipeline loom,” a London-based analyst said.

Looming large is the massive deal planned by Saudi Arabia. The sovereign on Tuesday set talk for a three-tranche issue of benchmark-sized and dollar-denominated notes due in five, 10 and 30 years. Citigroup, HSBC, JPMorgan, Bank of China, BNP Paribas, Deutsche Bank, Goldman Sachs, MUFG Securities, Morgan Stanley and NCB Capital are the bookrunners for the Rule 144A and Regulation S deal.

The five-year notes were talked at a spread in the Treasuries plus 160 basis points area. The 10-year notes were talked at a spread in the Treasuries plus 185 bps area. And the 30-year notes were talked at a spread in the Treasuries plus 235 bps area.

The proceeds from the deal, which is expected to price on Wednesday, will be used for general domestic budgetary purposes.

“Clearly these will tighten in, as they are the opening gambit,” a trader said. “Interestingly, a 10-bps revision brings them to ‘nice’ round numbers.”

The news on the Saudi Arabia deal sent Saudi Electricity Co.’s 2043s and 2044s jumping almost four points, a trader said.

The 2044s were seen at 103.25 and the 2043s at par.

“We also saw Bahrain 2044s firm up 12 bps,” he said. “Qatar’s 2046s were last at 106, up a point, and overall the entire space is well supported.”

And Oman saw its 2026s move up to 100.375 from Monday’s 99.65, he said.

Jordan in focus

Investors were also watching Jordan, which on Monday announced plans for a roadshow to market an issue of notes due in 10 and 30 years.

“Jordan historically has traded fairly well, even back to the days of the Jordan par bonds,” a trader said. “So it’s a credit that is well known and familiar to a lot of the big global funds. They had a little five-year bond that came in 2010 that quickly was locked away. Their return in 2015, with a long 10-year that, while initially a little heavy, eventually became very popular locally.”

The loose bonds were “soaked up,” he said.

Looking at the upcoming deal, “I don’t really see where a potential 30-year would garner a technical bid from,” he said. “In saying that, the new 10-year should find some support, given the relative lack of paper from Jordan and the eventual placement into the local funds and banks.”

Turk Eximbank sells bonds

Turkey’s Turk Eximbank priced $500 million 5 3/8% notes due Oct. 24, 2023 at 99.816 to yield mid-swaps plus 400 bps, following talk in the 410 bps area, a market source said.

Citigroup, HSBC, ING, Mizuho Securities, MUFG and Standard Chartered Bank were the bookrunners for the Rule 144A and Regulation S deal.

Proceeds will be used for general corporate purposes.

Turk Eximbank is an Ankara, Turkey-based export credit agency.

“The Turkish trade development bank is fully state-owned and has a policy mandate to support foreign trade and Turkish contractors and investors operating overseas,” the analyst said.

Roadshow for Kuveyt Turk

In other news from Turkey, Turkey’s Kuveyt Turk Katilim Bankasi AS will set out on Thursday for a roadshow to market a dollar-denominated issue of Islamic bonds, a market source said.

The transaction will be Regulation S.

Other details were not immediately available on Tuesday.

The issuer is an Istanbul-based Islamic finance institution.

Slovenia to issue in euros

In other deal-related news, Slovenia is planning to offer new euro-denominated notes alongside a tender offer, according to a filing from the sovereign.

Barclays Bank, Deutsche Bank, Goldman Sachs and JPMorgan are acting as dealer managers, and Lucid Issuer Services is acting as information and tender agent.

The sovereign is holding a tender offer for its $2.25 billion 5½% notes due 2022, $2.5 billion 5.85% notes due 2023 and $2 billion 5¼% notes due 2024.

Issuance from Alam Sutera

On Monday, Indonesia’s PT Alam Sutera Realty Tbk priced $245 million 6 5/8% notes due 2022 to yield 6¾%, a market source said.

JPMorgan and UBS were the bookrunners for the Regulation S deal.

The proceeds will be used to fund redemption of the issuer’s existing senior notes due in 2019 and for transaction expenses.

Other details were not immediately available on Tuesday.

Alam Sutera is a property developer based in Tangerang.

Ahli brings sukuk

Qatar’s Ahli Bank QSC priced $200 million 5½% perpetual bonds at par to yield 5½%, a market source said.

Citigroup, Credit Agricole CIB and Credit Suisse were the bookrunners for the Regulation S sukuk.

The lender is based in Doha.

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