Kazakh bank issues Eurobonds for first time

By Azernews

By Kamila Aliyeva

Development Bank of Kazakhstan JSC issued Eurobonds denominated in tenge in the amount of 100 billion for the first time, Kazinform reported.

A eurobond is denominated in a currency other than the home currency of the country or market in which it is issued. 

The maturity of the securities will be three years (the maturity date is December 14, 2020), Bolat Zhamishev, the Chairman of the Board of the Bank, said at a press conference on December 11.

Yield to maturity upon placement – 9.625 percent per annum, coupon rate - 9.5 percent per annum. Settlements for the transaction will be held on December 14 this year.

The geography of the bank’s securities placement is represented by the UK (63 percent of the volume of the issue), the U.S. (21 percent), Germany (8 percent) and other European countries (6 percent). Kazakhstan accounts for 2 percent of the volume.

As many as 97 percent of the securities’ volume are managed by asset managers, 2 percent - hedge funds, 1 percent - banks.

In absolute terms, we are talking about 29 investors, Zhamishev noted.

The financial consultants and traders of the issue are J.P. Morgan, Citi, Halyk Finance. Eurobonds of this issue will be placed on Kazakhstan (KASE) and London (LSE) stock exchanges.

Kazakhstan has a two-tiered banking system. The first tier is comprised of the National Bank of Kazakhstan (NBK), which reports to the president. The second tier includes 38 commercial banks, including one state-owned bank and 16 banks in which foreigners hold 30% or more of the bank’s shares. The National Bank acquired the functions of a financial regulator after merging with the Financial Supervision Agency in April 2011, and is therefore charged with overall supervision of the banking sector.