New issues from Korea Development Bank, Venezuela's CAF; buyers for Russian corporates

By Christine Van Dusen

Atlanta, July 16 - Korea Development Bank and Venezuela's Corporacion Andina de Fomento (CAF) sold notes on a Tuesday that saw tighter spreads and a solid tone amid light volumes for emerging markets assets.

"US Treasuries rallied yesterday, following worse-than-expected retail sales as concerns over tapering eased," a London-based analyst said. "The 10-years are opening relatively flat this morning at 2.55%. However, the market will be more focused on Bernanke's testimony beginning tomorrow."

The Markit iTraxx SovX CEEME ex-EU index spread on Tuesday moved to 225 basis points over Treasuries, tighter by 8 bps. The Markit iTraxx Crossover index spread - seen Monday at 431.5 bps - narrowed to 425 bps on Tuesday.

"Quiet start this morning, but overall a solid feel to the market," the analyst said. "The Middle East and North Africa are a couple of basis points tighter while in Russia, Evraz Group is performing."

The company's notes were 26 bps tighter on the week following the release of second-quarter production data.

"OAO Lukoil's 2023s are also seeing buyers," she said. "They're 6 bps tighter."

The perpetual notes that Dubai Islamic Bank priced at par opened Tuesday at 98.37 bid, 99.12 offered. Abu Dhabi Islamic Bank's perpetual notes, which also priced at par, started the session at 101 bid, 101¾ offered.

Tamweel's 2017s continued their "solid run," a trader said.

"They're 50 bps tighter on the month," he said.

Meanwhile, Korea Finance Corp. postponed a planned issue of €500 million five-year notes via BNP Paribas, Commerzbank, Credit Suisse, HSBC, Standard Chartered Bank, DZ Bank and Natixis.

Talk for the Regulation S-only deal was set in the mid-swaps plus 80 bps area.

Dubai names tighten

Dubai's 2014s were 25 bps tighter on the week and month, a London-based trader said.

"The front end bid goes on in the Middle East and North Africa," he said. "The one Dubai bond that refuses to be bid up today is Emirates NBD's perpetuals, which are unchanged."

"Rasgas' 2014s just traded at 105 and International Petroleum Investment Co.'s 2015s are still supported."

Saudi Electricity Co.'s 2043s were spotted at 92 bid, 92½ offered, about 7 bps tighter on the day.

Nigeria notes keep ticking up

The recent $1 billion of notes that Nigeria priced in two-tranches due 2018 and 2022 traded up on Tuesday.

The Rule 144A and Regulation S deal included $500 million 5 1/8% notes due 2018 that priced at 98.917 to yield 5 3/8%.

On Tuesday the notes were seen at 101¾ bid, 102¼ offered.

The second tranche of $500 million 6¾% notes due 2023 came to the market at 98.193 to yield 6 1/8%.

The notes were trading on Tuesday at 101½ bid, 102½ offered.

Citigroup and Deutsche Bank were the bookrunners for the deal.

KDB, CAF sell notes

In its new deal, Korea Development Bank priced a €200 million tap of its 1½% notes due 2018 at 98.799 to yield mid-swaps plus 70 bps, following talk in the 70 bps area.

Barclays, Credit Agricole, DZ Bank and KDB Asia were the bookrunners for the Regulation S deal.

And Venezuela-based lender CAF priced a CHF 250 million issue of notes due Aug. 13, 2020 to yield mid-swaps plus 50 bps with Credit Suisse.

Other details were not immediately available on Tuesday.

Indian Oil taps bookrunners

In other deal-related news, Indian Oil Corp. Ltd. has mandated Deutsche Bank, HSBC and Standard Chartered Bank as bookrunners for a dollar-denominated issue of notes that will be marketed during a roadshow, a market source said.

The marketing trip for the Regulation S deal will begin Wednesday and take place in Singapore, Hong Kong and London.

Multipolar on roadshow

Indonesia's PT Multipolar Tbk is on a roadshow for a dollar-denominated issue of notes with bookrunners Citigroup, Deutsche Bank and Nomura Securities, a market source said.

The roadshow for the Regulation S deal began on Monday and will travel to Hong Kong, Singapore and London.

The Tangerang, Indonesia-based issuer is an importer and retailer of computers and related products.

Hungarian lender picks banks

Hungarian Export-Import Bank (Hungarian Eximbank) has mandated HSBC and Jefferies as bookrunners for its upcoming issue of euro-denominated notes, a market source said.

A roadshow for the Rule 144A and Regulation S deal began on Tuesday.

Hungarian Eximbank is based in Budapest.

Philippines, Suriname deals

The Philippines is planning to issue $1 billion of global notes in 2014, a market source said.

And Suriname is seeking to issue dollar-denominated notes sometime this year, a market source said.

No other details were immediately available on Tuesday.

Eustream oversubscribed

The final book for Slovakia-based gas transmission company eustream's €500 million issue of 3¾% notes due 2020 that priced at 99.390 to yield mid-swaps plus 235 bps was €1.75 billion, a market source said.

Citigroup, ING, JPMorgan, KBC and Erste Group were the bookrunners for the Rule 144A and Regulation S deal.

The notes were issued by SPP Infrastructure Financing BV.

UOB notes attract orders

Also oversubscribed was Singapore-based United Overseas Bank Ltd.'s S$850 million 4.9% perpetual notes that priced at par to yield 4.9%, a market source said.

The notes drew S$2 billion in orders from about 80 accounts, with 93% from Singapore and 7% from others.

Private banks and retail accounted for 74%, banks 11%, insurers 11% and agencies 4%.

United Overseas Bank, ANZ, HSBC, Nomura, Standard Chartered Bank and UBS were the bookrunners for the Regulation S deal.

Final book for Naspers

South Africa-based mass media company Naspers Ltd.'s $750 million issue of 6% notes due 2020 drew more than €1.5 billion in orders, a market source said.

About 63% came from the United States, 15% from the United Kingdom, 11% from the Middle East and Africa, 8% from Europe, 2% from Asia and 1% from others.

Asset managers accounted for 83%, pension funds and insurers 13%, banks and private banks 3% and others 1%.

The notes priced at par via Barclays, Citigroup (active) and JPMorgan (passive) in a Rule 144A and Regulation S deal.

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