Croatia, Axis Bank sell notes; Russia sanctions extended; Asia weakens; roadshows ahead

By Christine Van Dusen

Atlanta, March 4 – Croatia and India’s Axis Bank Ltd. sold notes on Wednesday as the United States extended sanctions against Russia for another year.

“However, these sanctions primarily concern asset freezes of individuals, so are unlikely to affect markets here,” a London-based analyst said. “There were further reports of fighting overnight while the U.S. and European leaders held a meeting yesterday.”

Still, Russian bonds managed to tighten slightly on Wednesday, perhaps because this news was already priced in, a trader said.

Looking to the Middle East, the new issue of notes from Abu Dhabi Commercial Bank PJSC –$750 million 2 5/8% notes due March 10, 2020 that priced at 99.568 – traded marginally above reoffer on Wednesday, he said.

From Asia, bonds were weaker at the start of Wednesday’s session, but after the open in London they were able to recover somewhat and finish the day unchanged, a London-based trader said.

“Flows were light and mixed today, with some real-money sellers,” he said, noting that sellers focused on bonds from China’s oil complex. “In Korea, 10-year quasi-sovereigns were under pressure, with spreads 1 basis point to 3 bps wider.”

Among high-yield Asian names, property companies from China closed mixed, up or down ¼ point, he said.

The new issue of 7½% notes due 2020 that China’s Country Garden Holdings Co. Ltd. priced at par traded between 101 and 101¼ on Wednesday before closing unchanged, he said.

Bonds from India were tighter after a surprise rate cut from the central bank, and the Indonesia curve underperformed while Philippines’ curve held in better with light flows.

“Closed a ¼ point lower,” he said.

Lat-Am in focus

Latin American sovereign bonds were weaker at the end of Wednesday’s session, a New York-based trader said, as investors consolidated and notes pulled back from the tights of last week.

Brazil’s 2025s closed at 97, down from Tuesday’s 97½, and Mexico’s 2046s were seen at 101 after closing at 102½ on Tuesday, he said.

Last week’s “illiquid, hard-to-find bond trade” has turned into a trade where finding buyers is a challenge, he said.

Croatia sells bonds

In its new deal, Croatia priced €1.5 billion 3% notes due March 11, 2025 (Ba1/BB/BB) at 97.845 to yield mid-swaps plus 255 bps, matching talk, a market source said.

Barclays, Erste Group, JPMorgan and UniCredit/Zagrebacka banka were the bookrunners for the Regulation S deal.

Issuance from Axis Bank

Mumbai-based lender Axis Bank sold a $250 million tap of its 3¼% notes due May 21, 2020 at 101.461 to yield Treasuries plus 135 bps, matching talk, a market source said.

BofA Merrill Lynch, Citigroup, HSBC and Standard Chartered Bank were the bookrunners for the Regulation S re-opening. The original deal was also Rule 144A.

The original $500 million 3¼% senior notes due 2020 priced in November at 99.656 to yield 3.319%.

That deal was more than four times oversubscribed, with strong support from investors in Asia, the Middle East, Europe and the United States. Investors from Asia contributed 43%, Europe 24%, the Middle East 24% and the United States 9%.

The bank is based in Mumbai.

AIA Group gives guidance

In other deal-related news, China’s AIA Group Ltd. set talk in the Treasuries plus 125 bps area for a benchmark-sized issue of dollar-denominated notes due in 10 years, a market source said.

Deutsche Bank and Morgan Stanley are the bookrunners for the Rule 144A and Regulation S deal.

The proceeds will be used for general corporate purposes.

AIA is a pan-Asian life insurance group based in Hong Kong.

China Shanshui on deck

China Shanshui Cement Group Ltd. talked its dollar-denominated issue of five-year notes at 7¾%, a market source said.

BOC International, Credit Suisse and Morgan Stanley are the bookrunners for the Regulation S offering.

The proceeds will be used to refinance existing debt.

The cement manufacturing company is based in Jinan, China

Lodha Developers on roadshow

India’s Lodha Developers Private Ltd. is on a roadshow for a dollar-denominated issue of notes, a market source said.

JPMorgan, Barclays and CLSA are the bookrunners for the Regulation S deal.

The Mumbai-based real estate developer previously postponed plans for a deal, which was talked at a yield in the mid-to-high-10% area.

JPMorgan and BofA Merrill Lynch were the bookrunners for the Regulation S notes, which were to be non-callable for three years.

Sharjah Islamic plans roadshow

Sharjah Islamic Bank PJSC will depart on Thursday for a roadshow to market a dollar-denominated issue of benchmark-sized Islamic bonds, a market source said.

Abu Dhabi Islamic Bank, Al Hilal Bank, Dubai Islamic Bank, Emirates NBD Capital, HSBC, KFH Investment and Standard Chartered Bank are the bookrunners for the Regulation S deal.

The roadshow will begin in Singapore and end on Friday in London.

Roadshow for Emirates NBD

Dubai’s Emirates NBD will set out on March 9 for a roadshow to market a benchmark-sized issue of notes, a market source said.

BofA Merrill Lynch, BNP Paribas, Deutsche Bank, Emirates NDB Capital, HSBC and ING are the bookrunners for the Regulation S deal.

Emirates NBD is a provider of corporate, consumer, treasury and investment banking and asset management services.

Beijing corporate plans notes

China’s Beijing Infrastructure Investment (Hong Kong) Ltd. will host investor calls, starting March 9, for a euro-denominated issue of notes, a market source said.

RBS and Bank of China are the global coordinators for the Regulation S offering. RBS, Bank of China, BNP Paribas, CCB International, ICBC (Asia) and JPMorgan are the joint bookrunners.

The company also will host a roadshow in Frankfurt, London and Paris.

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