Page 85 - bne IntelliNews Country Report: Russia Dec17

coupon of 13%, backed only by 49% in Russian Standard bank. Reportedly, Standard is now considering pulling the coupon on the bonds and giving out or selling the shares of the bank to investors. The bank got in truble in 2015 prompting Standard & Poor's to downgrade the name from B- to CCC- and pushing Tariko to inject equity in the bank. However, recently the holding's vodka business has been booming, largely thanks to the fact the government has almost completely eradicated illegal vodka production.
Russian state-owned gas monopolist Gazprom floated a €750mn Eurobond with a coupon rate of 2.25% per annum on November 17, First Vice President of Gazprombank Denis Shulakov said reports TASS. "This is the lowest coupon rate for Russian issuers in any currency with the term of seven years. It is a landmark offering for the whole market made by Gazprom - a new record against highly diversified demand," Shulakov told TASS . Emerging market bonds have been in high demand this year thanks to low interests rates in the established markets. European investors (excluding the United Kingdom) purchased about 57% of Eurobonds, with Germany accounting for 16%, the banker said. Swiss investors purchased 8.6% of securities. Italian investors bought 4.4% of Eurobonds. UK investors bought securities worth €50mn or 6.7% of the offering. Russians acquired 31.8% of Eurobonds. Investors from the United States and Taiwan purchased 4% and 0.5% of the issue respectively. Banks purchased 54% of the offering and investment funds bought 42%, Shulakov said. The bond was at the bottom of the range. The initial yield guidance was 2.5% but reduced later to 2.25-2.375% per annum thanks to high demand for the paper. This is the fourth bond Gazprom has issued this year. The Russian gas holding already floated securities worth $750mn, GBP850mn and CHF500mn earlier this year.
85 RUSSIA Country Report December 2017 www.intellinews.com