Eurasian Development Bank Issues New Tenge Bond with Kazkommerts Securities Support

11 October 2017

Almaty, October 11, 2017. The Eurasian Development Bank (EDB) has successfully placed a KZT 20 billion bond issue in the JSC Kazakhstan Stock Exchange (KASE) trading system. The placement was completed on October 10, 2017.

Based on the results of a series of meetings with potential investors held in Kazakhstan in September 2017, the Bank resolved to place its second bond issue this year. The aggregate par value of the issue amounts to KZT 20 billion. The tenure is 3 years. The coupon bond at which buyer bids have been executed is 9.40 percent per annum. Moody's rating agency has assigned to the bonds a credit rating at the level of the Bank's current rating (Baa1).

A total of 14 bids were tendered by investors for KZT 28.5 billion. With demand for the bonds at the cut-off rate having exceeded their aggregate par value, the bids have been granted on a pro rata basis. JSC Kazkommerts Securities acted as the financial advisor and underwriter, providing support to the Eurasian Development Bank throughout the listing and placement process.

The placement has shown, yet again, not only that the Bank's bonds enjoy high demand among Kazakh investors, but also that the Bank is capable of successfully offering such bonds to an unlimited investor base. The placement has been completed with a minimum spread vs. government securities yield curve, a positive trend indicative of a generally favorable market sentiment towards financial instruments offered by reliable issuers. Bids were tendered by major Kazakh banks, a number of national insurance market players, and certain broker companies.

"It is critical for our bank to have free access to tenge-denominated resources that we need to finance our project activities. We are happy to say that market recovery has reached a point where we are able to raise enough funds to fully support our investment portfolio. We hope that debt market liquidity will continue to grow, and rates will gradually go down to pre-crisis levels. We are also thankful to our investors for their trust," said Dmitry Ladikov-Royev, EDB Managing Director, ALM.

"This market offering of EDB bonds has shown once again that Kazakh investors are highly interested in securities offered by premium investors. In our opinion, the market has adequately responded to current government security yields and the threefold decrease of the base rate in 2017. Despite the relatively recent placement by the Bank of a bond with similar metrics and a yield to maturity of 10.1 percent, the new issue has been oversubscribed, testifying to high investor appetite for fixing tenge yields. The painstaking work that we, as the underwriter, have done to determine the optimum offering price has resulted in the bond having been placed on the best possible terms both for investors and the issuer – an outstanding outcome of financial advisor endeavors," commented Zhaksybek Chingiz, JSC Kazkommerts Securities Board Chairman.

Additional Information:

Eurasian Development Bank (EDB) is an international financial institution founded by Russia and Kazakhstan in January 2006 to promote development of market economies of its member states, and secure their sustainable economic growth and expansion of their mutual trade and economic ties. The charter capital of the EDB is $ 7 billion. The member states of the Bank are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation, and the Republic of Tajikistan.

JSC Kazkommerts Securities is one of the leading investment banks in Kazakhstan offering the full range of investment banking services, including brokerage, securities trading, financial consulting and underwriting (organization of issuance and placement of debt and equity securities), corporate financing, investment portfolio management, and other similar services.

EDB Media Center:
+7 (727) 244 40 44 ext. 6147 (Almaty)

+7 (495) 645 04 45 ext. 2732 (Moscow)

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