NUR-SULTAN

Kazakhstan’s Finance Ministry placed four bond issues worth a total of 40 billion Russian roubles ($554 million) on the Moscow and Astana (Kazakhstan) stock exchanges, the largest transaction by a foreign issuer on the Russian bond market so far this year.

Russia’s Gazprombank acted as one of the organisers of the deal.

New issues of five-year and seven-year sovereign bonds of 10 billion roubles each, as well as two issues of ten-year bonds of 10 billion roubles each, were put up.

“The book was attended by Russian banks and investment companies, including demand from individuals,  applications were also received from foreign investors,” Denis Shulakov, Gazprom’s vice president, told reporters.

The initial benchmark for the first coupon rate for a five-year issue was no more than 7.55 percent per annum. For a seven-year issue it was no more than 7.75 percent per annum, and for ten-year issues no more than 8 percent per annum. The final coupon on five-year securities was 7.48 percent, for seven-year securities, 7.69 percent, and for ten-year securities, 7.92 percent.

The technical part of the placement is scheduled for June 28. The placement is planned on the Moscow Exchange and Kazakhstan’s AIX. The organisers, besides Gazprombank, are Russia’s VTB Capital, Eurasian Development Bank, Credit Bank of Moscow, Sberbank KIB and First Heartland Securities.

Kazakhstan tapped Russia’s bond market last year by issuing rouble bonds worth around $523 million. The amount was the lowest on record due to negative sentiment on the world’s stock markets and lower oil prices.

The Central Asian nation has been mostly borrowing on Western markets. Both Russia and Kazakhstan are oil exporters and their currencies – the rouble and tenge, respectively – often move in the same direction against the dollar.

The country’s state debt stood at 20.6 trillion tenge ($48.3 billion) or 29.6 percent of Gross Domestic Product as of January 1, 2021.