Page 98 - IFR Opportunities in Russian capital markets

CHAPTER04
ifrintelligence reports/Opportunities in: Russian Capital Markets
Figure 4.19: Russian Eurobond market 2001–07E (US$bn)
US$bn
80
60
40
20
0
Outstanding amount of Sovereign Eurobonds
Outstanding amount of non-government Eurobonds
Source: Troika Dialog
2001 2002 2003
2004 2005 1H06
2H06E 2007E
This rapid growth has already made Russia the second largest issuer of international corporate bonds in the emerging market universe, second only to South Korea, as shown in Table 4.2.
Table 4.2: Emerging markets international bond issuance, 2001–2Q2006 (US$bn)
Dec01 Dec02
South Korea 19.4 20.0
Russia 0.5 3.5
Mexico 21.1 17.9 Brazil 12.5 10.6 Malaysia 9.9 9.6
Source: BIS, Troika Dialog
Dec03 Dec04
20.3 22.5
9.5 15.1
16.4 14.6 13.7 10.7 8.2 7.3
Dec05 Jun06
25.4 26.3
22.5 25.3
18.4 18.2 10.8 12.7 6.4 6.2
Gazprom remains the biggest issuer of international debt securities. Even without its subsidiaries, Gazprom Neft (former Sibneft) and Gazprombank, bonds issued by the corporation make up 14% of the market.
The biggest issuer among the banks was also a quasi-sovereign state-owned bank, VTB (formerly Vneshtorgbank), with a market share of 8% (see Figure 4.20).
Figure 4.20: Russian corporate bond issuers, Nov 2006 (%)
6%
38%
Source: Troika Dialog
8%
13%
Sovereigns and MinFins Non-quasi-Sovereign
Other quasi-Sovereign VTB (incl. Mosnarbank) Gazprom
27%
In all, the share of quasi-sovereign Eurobonds (excluding CLNs) make up about 60% of all corporate Eurobond issues as of the end of 2006, a ratio that has remained remarkably stable in the last few years.
In 2007, refinancing needs will increase for corporate Eurobond issuers. Russian issuers redeemed US$3.7bn of debt securities in 2006 and are expected to redeem US$7.7bn in 2007 and US$8.8bn in 2008, the bulk of which is expected to be refinanced with new issues.
91