SOCAR names its market maker on bonds

By Azernews

By Rashid Shirinov

The Azerbaijani state oil company SOCAR has assumed obligations on sale of its USD bonds in the secondary market with the support of the market maker CJSC Investment Company PSG Kapital, Baku Stock Exchange’s (BSE) reported on September 28.

The bonds issued by investors for sale on the secondary market, will in full accordance with the regulations of the BSE be provided by SOCAR through the quotations submitted by the exchange member.

“This means that the bond owners do not have to wait until the repayment period (five years) ends. They will be able to sell bonds on the BSE at any time and get the invested money,” reads the message.

At the same time, PSG Kapital, as the market maker on the bonds, will put daily quotations at the BSE with a maximum corridor of five percent. “The issuer has granted a guarantee that submitted quotations will not be lower than the nominal value of bonds," the report states.

Under current law, the compliance with the obligations to buyback bonds will start after the initial public offering (IPO).

PSG Kapital will set quotations daily from 10:00 to the e-Commerce system and website of BSE.

The company started issuance of USD bonds for Azerbaijani citizens from September 20. The nominal value of each bond is $1,000, while the total volume of emission is $100 million. The annual bond yield is 5 percent, while interest income is not taxable and will be paid quarterly.

One of the main advantages of SOCAR’s bonds is that their annual interest yield is higher than the rates applied in reference to dollar deposits placed in banks, where the annual interest rate on dollar deposits currently stands at 2.5-3 percent.