OREANDA-NEWS. July 9, 2009. Preparation to issue converted bonds for the first time in the history of Azerbaijan has been completed.

Unibank Supervisory Board’s chairman Eldar Garibov informed that placing of bonds is expected by the end of month.

“We prepare a new tool, but it is enough widespread in the world. Only the European Bank for Reconstruction and Development (EBRD) and DEG investment company buy our bonds. They will share proportionally to their packs, on share of participation in financing,” Garibov said.

Unibank’s chairman of board Faig Huseynov says that converted bonds is new tool in a market and Central Bank of Azerbaijan (CBA) and State Committee for Securities conducted large work on preparation of the issue.

“From now on, terms of the issue are known and coordinated by buyers and check was conducted by the committee. They meet in full the requirements of Azerbaijani legislation,” F. Huseynov said.

It is significant that Unibank, the first issuer of converted bonds, earlier first issued corporative bonds in Azerbaijan.

Today Unibank has received financing package of USD 83 million consisting of USD 37 million from the EBRD, USD 15.6 million from Deutsche Investitions-und Entwicklungsgesellschaft mbH (DEG), USD 15 million from the Netherlands Development Finance Company (FMO), and USD 10 million from the Development Bank of Austria (OeEB). Unibank’s local shareholders are contributing with USD 5.4 million.

The package includes a USD 7 million equity investment, a USD 25 million senior convertible bond and a USD 51 million senior loan. The financing will be used to strengthen Unibank’s capital base and will assist Unibank to carry on lending to the real economy in the current difficult environment.

The package is complemented by technical assistance provided by the partnering institutions to help Unibank strengthen its credit and risk management policies in the face of economic recession and develop a long term-funding base.

Overall, since the beginning of its operations in Azerbaijan, the EBRD has committed over 800 million euro across more than 90 projects.