Page 41 - TURKRptNov22

7.3 Fixed income
7.3.1 Fixed income - bond news
Small-cap Fibabanka, Turkish conglomerate Fiba Holding’s lending unit, launched an exchange offer for its outstanding subordinated (Basel III-compliant Tier II) eurobonds.
Fibabanka was to provide up to $150mn worth of a new subordinated paper with a new coupon rate, a new ISIN (International Securities Identification Number) and a new maturity.
However, later on, the bank cancelled the exchange offer.
In 2017, Fibabanka sold $300mn of the paper in question (XS1386178237), which pays a 7.75% coupon. The paper has a maturity due 2027 and is callable at the end of the fifth year, namely November 24, 2022.
The market norm for Turkish banks has generally been to call Tier 2 debt after five years.
However, in May, Garanti BBVA (GARAN), a unit of BBVA (Madrid/BBVA), opted not to call its $750mn, 10-year subordinated (Tier II) eurobond (XS1617531063), sold on May 23, 2017.
Also in May, small-cap Sekerbank (SKBNK) decided not to call its $85mn, Tier 2 paper, instead opting to extend the tenor.
In August, another small-cap, Odeabank, a unit of Bank Audi (Beirut/AUDI), failed to call $300mn of papers (XS1655085485).
On November 1, government-run Vakifbank (VAKBN) redeemed $228mn of 10-year subordinated (Basel III-compliant Tier II) eurobonds (XS1551747733), sold on February 13, 2017, and callable at the end of the fifth year.
41 TURKEY Country Report November 2022 www.intellinews.com