17 Dec 2009 11:25

VEB to start placing $2 bln in second series bonds on Dec 25

MOSCOW. Dec 17 (Interfax) - Vnesheconombank (VEB) plans to start placing $2 billion in second-series bonds on December 25, the bank said in a statement.

The bonds will mature on one year. The issue will consist of 2 million bonds, par value $1,000 each.

They will be placed in a private subscription, potential buyers being lending organizations set up in accordance with Russian law and licensed by the Central Bank to perform banking operations with foreign currency; and the Central Bank itself.

The Federal Financial Markets Service (FFMS) registered five VEB forex bond issues worth $2 billion each in May this year.

VEB placed the first issue on June 3, receiving ten bids from a syndicate that included Sberbank , Rosbank, Russian Standard Bank , Gazprombank, Alfa-Bank , Citibank and Raiffeisenbank.

The coupon rate on the bonds is LIBOR+1% pa.

Market participants describe the VEB bonds as an alternative to the CB's zero-interest forex deposits, on which banks had to hold forex assets before the new instrument came out.