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bne August 2020 The Month That Was I 7
Finance
Eastern Europe
In the first quarter of 2020, the share of the dollar in trade between Russia and China fell below 50% for the first time from over 90% four years ago. According to Moscow daily Izvestia,
the share of dollars used to settle trade deals between Moscow and Beijing has dropped to 46%, tumbling from 75%
in 2018. The 54% of non-dollar trade
is made up of Chinese yuan (17%), the euro (30%) and the Russian ruble (7%).
The Russian government has approved an additional share
issue for national air carrier Aeroflot Group, given that the state's stake remains above the current 51.17%. The placement could be in the range of RUB50bn-100bn ($690mn-1.38bn).
The demand for mortgages in Russia in June was almost a third higher than in the same month a year earlier, according to the United Credit Bureau (OKB). In June banks issued more
than 109,000 mortgage loans totalling RUB258bn ($3.6bn). The number of issues exceeds the figures for June 2019 by 22%, and the volume by 28%.
Russian President Vladimir Putin has ordered the government to study mechanisms of hedging national oil and gas revenues against price volatility. Previously unnamed sources told Interfax that Russia could use the Mexican model of buying put options to hedge against sharp fluctuations in oil prices.
Russian electronic payment service Qiwi has cancelled its SPO only a week after it announced it. The company said
poor market conditions was the reason for the cancellation. A 6.8mn-share
SPO was announced on July 20,
making 11-12% share capital. Selling shareholders were mainly Orkritie Bank, as well as Sergey Solonin (Qiwi’s BoD chairman) and Boris Kim (Qiwi’s CEO).
In 1H20 the Russian mergers and acquisitions market declined to $40.6bn, its lowest level in nine years. As much as $33.9bn of that was accounted for the finance ministry buying 50% in Russia's largest bank Sberbank from the Central Bank of Russia (CBR). Apart from that, the M&A activity in 1H20 was at the lowest point since 2004.
The Russian State Duma has adopted
a law limiting the access of unqualified private retail investors to risky instruments. Since the beginning of 2020 Russia has seen a surge in retail investors taking an interest in equity trading.
The Russian banking sector posted RUB70bn ($1bn) in June 2020, with profit for 2Q20 overall dropping 5-fold year on year to RUB103bn, according to the banking sector data from the Central Bank of Russia (CBR).
The Ukrainian government placed
at par $2bn in Eurobonds maturing in March 2033 at a 7.253% yield to maturity on July 27. The government will use the total of $846mn to buy back notes maturing in September 2021 (the principal of $435mn at 104.5% of par) and 2022 (the principal of $371mn at 105.5%).
Ukraine and the EU signed on
July 23 an agreement for a €1.2bn macrofinancial loan. The first €600mn loan was granted immediately, while the second tranche will depend on fulfilling requirements in the spheres of judicial, tax and customs structural reform.
Ukrainian lenders doubled the volume of crediting under the Affordable Loans 5-7-9% programme. The
partner banks of the Entrepreneurship Development Fund last week concluded 196 new agreements for a total amount of UAH638mn ($23.5mn) under the programme.
Central Europe
The owners of Poland’s top online retailer and auction portal Allegro plan to list the company on the Warsaw Stock Exchange in September. The company is controlled by the private equity funds Cinven, Permira, and Mid Europa Partners.
Southeast Europe
Turkey has overtaken Russia to become the world's largest purchaser of gold amid concerns that it could be barred from dollar settlements over cooling ties with the US. The Central Bank of the Republic of Turkey (CBRT) purchased around 148 tonnes of gold in the January-May period, roughly triple the figure last year.
Foreigners’ share in Borsa Istanbul’s free-float fell to 49.82% at market close on July 7, Is Invest’s daily foreigners’ share bulletin showed on July 8. It was the first time since June 2004 that foreigners’ share in the stock exchange fell below 50%.
Romania’s Enterprise Robotic Process Automation (RPA) software company UiPath is preparing a IPO that is expected to value the company at $10.2bn.
Slovenia will obtain €10.5bn from the European Union for 2021-2027, as part of the EU multinational financial framework and the recovery instrument worth a total €1,824bn, the country’s Prime Mnister Janez Jansa said. The money will be used as coronacrisis support and invested into a green and digital transition.
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