Issues from Indonesia, China Taiping, Sri Lankan bank; Russian banks under pressure

By Christine Van Dusen

Atlanta, Sept. 2 – Indonesia, Korea Development Bank, China Taiping Insurance Holdings Co. Ltd. and Sri Lanka’s National Savings Bank sold notes on Tuesday, as long-dated bonds from the Middle East saw demand and Russian banks remained under pressure.

“Duration still has a bid, despite the performance of the long bond, with Qatar, Saudi Arabia and Abu Dhabi long bonds in demand,” a London-based trader said. “Special mention to Qtel International’s 2043 – bid today above par. A decent squeeze on this one.”

Russia, and its ongoing conflict with Ukraine, remained in focus as news outlets reported that President Vladimir Putin said he could “take Kiev in two weeks.” This followed talks on Tuesday in Misk between pro-Russia rebels and Ukraine.

“With the Ukraine army now under pressure, Kiev’s willingness to negotiate may well have increased,” a London-based analyst said. “Nonetheless, a breakthrough does not seem imminent.”

“It’s worth keeping an eye on Russian assets,” the London trader said. “Some of the big state banks have really come under pressure again lately.”

Market sources pointed to OAO Sberbank’s 2019s, which were yielding about 6% on Tuesday.

“Russia is opening a little weaker this morning, with market activity increasing as the holiday period comes to an end,” the analyst said. “Banks and corporates are generally wider.”

In deal-related news, Brazil’s Gol Linhas Aereas Inteligentes SA and Dubai’s Emirates NBD set roadshows for upcoming issues.

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