Korea Resources, Russia’s Renaissance sell notes; Lat-Am tightens; Global Ports on deck

By Christine Van Dusen

Atlanta, April 11 – Korea Resources Corp. and Russia’s Renaissance Financial Holdings Ltd. were among the issuers to print notes on Monday, as investors kept their eye on the post-election picture in Peru, as well as the global economy.

“The focus this week will be mainly on the state of the global economy, as the IMF will publish an update on the World Economic Outlook ahead of the IMF and World Bank Spring Meetings this weekend,” a London-based strategist said. “The institution is expected to slightly revise the growth outlook to the downside.”

Also ahead is the meeting of oil producers inside and outside the Organization of the Petroleum Exporting Countries (OPEC), which will take place on April 17.

“Ahead of the meeting, it was reported that Iraq, OPEC’s second largest producer, increased its output to new record levels at 4.55 million barrels per day in March, from 4.46 million barrels per day in February,” he said. “It is not clear whether the country will participate in any freeze agreement, although it has stated support for such a move.”

Iran is not expected to freeze its output at current levels, he said, “and the crux of the matter is therefore whether the other producers are able to compromise nonetheless.”

Despite this uncertainty, oil prices have been climbing, “also reflecting potential declines in U.S. output.”

Meanwhile, spreads for Latin American bonds finished tighter and higher on the day, led by Peru, as election results boosted sentiment, a New York-based trader said.

Lat-Am in focus

Brazil’s five-year credit default swaps spreads closed at 373 basis points from 386 bps, while Mexico’s moved to 172 bps from 176 bps.

“Cash prices move higher, with long-end bonds generally outperforming in most curves, as curve-flattening continues in the Latin American external space,” the trader said. “Lat-Am high-yield finishes unchanged to higher on the session.”

Venezuela’s 2027s closed at 37.50 from 37.75, and PDVSA’s 2017s finished at 37.50 from 37.75.

Argentina’s Bonar 2024s were up at 108.75 from 108.25, he said.

“Good two-way flows for the session, with better buyers for a good chunk of the morning and opportunistic sellers emerging late in the day,” he said. “Constructive day, overall, for EM credit, despite the rally fading a bit into the close.”

Ukraine PM steps down

Looking to Ukraine, the prime minister stepped down over the weekend, the strategist said.

“There has been increasing pressure for his resignation already earlier this year, following political infighting and a no-confidence vote in February,” he said.

The current parliament speaker is the likely successor, he said, and the finance minister is likely to stay in place – news that is of concern to investors, he said.

Korea Resources does deal

In its new deal, Korea Resources priced $500 million 2¼% notes due April 19, 2021 at 99.906 to yield 2.27%, or Treasuries plus 110 bps, a market source said.

BofA Merrill Lynch, BNP Paribas, Citigroup and HSBC were the bookrunners for the Regulation S deal.

Korea Resources is a mining company based in Seoul, South Korea.

Renaissance Financial notes

Russia’s Renaissance Financial Holdings sold $200 million 9½% notes due April 14, 2021 at par to yield 9½%, a market source said.

Renaissance Capital and UBS Investment Bank were the bookrunners for the deal.

Renaissance is a Moscow-based financial institution.

Alternatifbank gives guidance

Turkey’s Alternatifbank AS set talk at 9½% to 9¾% for an issue of $250 million to $300 million notes due in 10 years, a market source said.

BofA Merrill Lynch, Citigroup and Commerzbank are the bookrunners for the Regulation S deal.

Pricing is expected on Tuesday.

The lender is based in Istanbul.

Global Ports launches bonds

Russia-focused Global Ports Investments plc launched a $350 million issue of notes due in January of 2022 at 6 7/8%, a market source said.

JPMorgan, ING Bank, RBI, Sberbank, Unicredit and VTBC are the bookrunners for the Rule 144A and Regulation S notes, which will be issued via Global Ports (Finance) Plc.

Cyprus-based Global Ports operates the container terminal that serves Russian cargo flows.

Uruguay could issue

Uruguay could issue euro- or yen-denominated notes sometime this year, a market source said.

The sovereign met with officials from the Japan Bank for International Cooperation to discuss the possibility of the yen bonds.

Other details were not immediately available on Monday.

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