Page 92 - TURKRptMay19

8.5.1 Fixed income - bond news
Turkish Treasury's Eurobond Issues in 2019
Issue Date
Currency
Size
Maturity
Coupon Rate (%)
Price (%)
Yield to Investor (%)
Yield to Investor (Spread)
Euro Cost (%)
26.03.2019
USD
1bn
26.04.2029
7.625
103.3
7.15
UST + 454 bps
4.859
21.02.2019
USD (Sukuk)
2bn
21.02.2022
5.8
100
5.80
MS + 318 bps
31.01.2019
EUR
1.25bn
31.03.2025
4.625
99.36
4.75
MS + 446 bps
16.01.2019
USD
2bn
26.04.2029
7.625
99.555
7.68
UST + 497bp
4.965
Turkish Treasury's Eurobond Issues in 2018
14.11.2018
EUR
1.5bn
16.02.2026
5.2
99.73
5.25
MS + 456.4 bp
23.10.2018
USD
2bn
23.12.2023
7.25
98.917
7.50
UST + 447.5 bp
24.04.2018
USD
2bn
24.10.2028
6.125
99.427
6.20
UST + 336.8 bp
17.01.2018
USD
2bn
17.02.2028
5.125
99.411
5.20
UST + 266.7 bp
Turkish Treasury's Eurobond Issues in 2017
13.09.2017
USD
1.75bn
11.05.2047
5.75
101
5.70
UST + 300.5 bp
14.06.2017
EUR
1bn
14.06.2025
3.25
99
3.377
MS + 285 bp
11.05.2017
USD
1.75bn
11.05.2047
5.75
98
5.875
UST + 286.7 bp
06.04.2017
USD (Sukuk)
1.25bn
06.04.2023
5
100
5
MS + 285 bp
23.02.2017
USD
1.25bn
25.03.2027
6
103
5.65
UST + 320.5 bp
23.01.2017
USD
2bn
25.03.2027
6
99
6.15
UST + 375.7 bp
source: treasury
Teflon domestic government bond rates. The benchmark 5-year bond jumped 178 basis points on April 11, the first time the note has traded this week, Bloomberg also reported. Bloomberg’s note was another indication of what lies behind the teflon domestic government bond rates that catch the eye. When there is a transaction the rates show visible signs of life, even if that life is rather limited, because the public lenders are closely marking the domestic government bonds market and the FX market, including the lira swaps market in London.
Turkey’s 5-year credit default swaps (CDS) also widened for a fourth day on April 11, touching a high of 431.7bp . The “invisible hand” kept the lira below the 5.70 rate for four days and its impact on the local currency could be tracked against the rise in the CDS figures, set based on free market rules unlike the lira and bond rates.
“I think the reserves are becoming the Achilles heel of Turkey and poor handling of political or economic issues could cause a run on the lira,” Lorenzo Gallenga of Quaestio Capital Management told Bloomberg. Gallenga has no exposure to Turkish debt. “I invested in some of the new issuance that came at the beginning of the year in USD and EUR, but came out fairly early at good levels. Because of the reserves issue and the expectation of a political price to be paid by AK Party we sold local currency debt to 0 around the election,” he added.
92 TURKEY Country Report May 2019 www.intellinews.com