Rosselkhozbank may place 10-yr subordinated Eurobonds with 5-yr call option
MOSCOW. May 23 (Interfax) - Rosselkhozbank (RSHB) may place ten-year subordinated Eurobonds with a five-year call option at face value this week, a source in financial circles told Interfax.
Of the call option is not exercised after the bonds are in circulation for five years, the coupon rate will be determined by the yield on five-year US Treasuries on the call-option date and spread of 150 basis points.
The bank intends to place these benchmark securities in U.S. dollars. Financial-market sources told Interfax that RSHB is looking to raise at least $500 million. The proceeds will be used to in effecting a call option this September on $500 million in subordinated Eurobonds at 6.97% that mature in 2016.
A RSHB Eurobond road show kicked off on May 18 and is slated to end May 25. The meetings with investors in Europe and the United States are being organized by Barclays Capital, JP Morgan, and VTB Capital.
Placement will take place according to 144A/Reg S rules.
As reported earlier, RSHB increased its equity as calculated to International Financial Reporting Standards (IFRS) by 1.6% to 163.026 billion rubles last year. The bank's capital adequacy ratio was 17.5% as of the end of last year, tier-one capital - 12.4%.
RSHB is 100% government-owned. It ended Q1 2011 in 4th by assets on the Interfax-100 ranking of Russian bank size.