Findeter advances deal; Russia, Ukraine conflict continues; Chilean bonds outperform

By Christine Van Dusen

Atlanta, Aug. 6 – Colombia’s Financiera de Desarrollo Territorial SA (Findeter) advanced a new deal on Wednesday as the geopolitical conflicts in Russia, Ukraine, Israel and Argentina put pressure on the asset class.

“[Russian] President Putin told the Russian government to consider retaliation in response to Western sanctions while a report quoted the Polish foreign minister on the risk of invasion following a renewed build-up of Russian troops on Ukraine’s border,” according to a report from Barclays. “The ensuing uncertainty outweighed positive sentiment emanating from the release of better-than-forecast U.S. data.”

Bonds from Russia have seen some “aggressive selling” so far this week, said Svitlana Rusakova of Dragon Capital.

“The sovereign dropped around 1 point while corporates continued to suffer from poor sentiment and lower liquidity, registering declines of 2 points to 4 points,” she said.

In other news from Russia, market sources were whispering about a possible issue of dollar-denominated notes from Moscow-based lender OJSC Alfa Bank.

Meanwhile, bonds from Latin America opened weaker on Wednesday but did see some stability as the session went on, a New York-based trader said.

Some offers were “pretty aggressive” as the market strengthened, he said, but “follow-through stability” would be necessary to sustain any positivity.

Not all names got a boost on Wednesday afternoon, he said. Weakness remained for Colombia’s Ecopetrol SA, for example. Other Colombian credits, particularly those in the banking sector, fared a bit better but still didn’t see much trading activity.

Bonds from Chile were the outperformers on Wednesday, even as liquidity remained a challenge, he said. Chile’s Masisa SA saw its 9½% 2019s, which priced at par, pull back and get better offered ahead of its upcoming earnings release.

And some fairly solid volumes were seen for Mexico-based Cemex SAB de CV’s 2024s, the trader said.

Findeter gives guidance

Colombia’s Findeter set talk in the 8¼% area for its upcoming issue of 10-year notes denominated in Colombian pesos and payable in dollars, a market source said.

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

The proceeds will be used for general corporate purposes.

Findeter is a banking company based in Bogota.

Latvian corporate sets talk

Latvia’s AS 4finance set talk in the 11¾% area for its upcoming issue of dollar-denominated notes due in five years, a market source said.

Credit Suisse is the bookrunner for the Rule 144A and Regulation S deal.

The proceeds will be used to refinance existing debt, including the payment of a concurrent tender offer, and for general corporate purposes.

The provider of short-term loans is based in Riga, Latvia.

Marketing trip for Polaris

Singapore’s Polaris Ltd. is on a roadshow for a possible issue of notes, a market source said.

ANZ and Standard Chartered Bank are leading the marketing trip.

No other details were immediately available on Wednesday.

Polaris is an investment holding company that focuses on distribution and sale of consumer electronics in Asia.

CCB will hit the road

China Construction Bank (Asia) Corp. Ltd. has mandated CCB International, Citigroup and HSBC to lead a roadshow for a dollar-denominated issue of notes, a market source said.

The roadshow will run from Thursday until Monday.

A Regulation S deal is expected to follow.

The bank is based in Beijing.

KCB seeks issuance

Kenya Commercial Bank is looking to issue at least $250 million of bonds in 2015, a market source said.

No other details were immediately available on Wednesday.

The lender is based in Nairobi.

Deal attracts orders

The new issue from China Merchants Bank Co. Ltd. – $500 million 3¼% notes due 2019 that priced at 99.812 to yield Treasuries plus 162.5 bps – drew an order book of more than $1.5 billion from more than 120 accounts, a market source said.

The notes were talked at a spread in the 165 bps area.

ANZ, HSBC, Morgan Stanley, UBS, CMB International Capital, Credit Suisse and Wing Lung Bank were the bookrunners for the Regulation S deal.

About 97% of the orders came from Asia and 3% from Europe, with 65% from banks, 20% from fund managers, 8% from insurance and 7% from private banks.

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