Lebanon sets guidance for benchmark fixed-rate dollar deal; Alliance Oil returns, sets talk

By Paul A. Harris

St. Louis, March 3 - Bond performance in the emerging markets was mixed during the New York session, according to a syndicate banker there.

Peru, after trading inside of Brazil on Tuesday, widened by a point, the banker said.

"Now it appears that people reduced their positions," the source remarked.

"Perhaps it tightened too much.

"But it's very interesting because it was the first time, ever, that we saw Peru trading inside of Brazil."

Meanwhile, Argentina was softer on the day on news that opposition legislators received appointments to key congressional committee posts in a move that could block the use of central bank reserves to repay sovereign debt, the syndicate source said.

New Kexim trading well

Among recently priced issues, Export-Import Bank of Korea's new 4 1/8% 5.5-year senior unsecured notes (A2/A/A+), which priced Tuesday at a 195 basis point spread to Treasuries, were 9 bps tighter on Wednesday at the end of the New York session.

That's according to a sellside source, who added that the new issue offered up a concession of 5 bps on Tuesday, then plowed back that concession on Wednesday and tightened a further 4 bps.

Much earlier on Wednesday, at the Asia close, the new Kexim 4 1/8% notes were trading well, according to a Singapore-based trader who focuses on Asian fixed income.

The deal did not seem especially cheap, but accounts appear to have been prepared for the supply, and it performed well on the break in spite of being relatively tight, in Libor terms, compared to secondary spreads, the trader remarked.

Lebanon gives 10-year guidance

Meanwhile, the primary market produced news on Wednesday.

Republic of Lebanon (B2/B/B-) is in the market with a benchmark dollar-denominated fixed-rate deal, according to a market source.

Guidance is in the 6½% area.

BNP Paribas is the lead bookrunner.

Alliance Oil returns

Less than a week after postponing its deal due to market conditions, Moscow-based Alliance Oil Co. Ltd. has returned with a dollar-denominated offering of five-year senior unsecured global bonds (/B+/B).

Price talk is in the 10% area.

The Rule 144A and Regulation S offering is expected to price before the end of the week.

BNP Paribas, Credit Suisse and JPMorgan were leading the offering.

Proceeds will be used to refinance debt and for general corporate purposes.

Prior to being pulled last week, investors were looking for as much as 11% from Alliance Oil, well north of Wednesday's 10% price talk, according to a market source.

Banco Daycoval starts Thursday

Elsewhere, Brazil's Banco Daycoval (/BB/BB) will begin a roadshow in Switzerland on Thursday for its dollar-denominated offering of five-year senior notes.

Marketing continues in Switzerland, as well as in Miami, on Friday. Presentations will be made in London and New York on Monday.

Banco Itau, Morgan Stanley and Santander are joint lead managers for the Regulation S offering.

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