OREANDA-NEWS. October 29, 2010. Vnesheconombank has completed placing bonds of series 06 with a total par value of 10 billion rubles, with an offer in 7 years from the date of placement as well as bonds of series 08 with a total par value of 15 billion rubles with an offer in 3 years from the date of placement.

As a result of the placement Vnesheconombank raised 25 billion rubles; this sum meets Vnesheconombank’s current needs for financing purposes taking into account yield rates offered by investors in the course of marketing. On October 21, 2010, bid books for Vnesheconombank’s bonds of series 06 and 08 were successfully closed.

In the course of marketing the indicative price range was reduced from 8.25-8.50% to 7.90-8.25% for a seven-year bond issue and from 7.25-7.50% to 6.90-7.25% for a three-year bond issue.

Investors submitted 67 applications for bonds of series 06 with a coupon rate from 6.70% to 7.25 per annum. In the course of marketing the total amount of demand for bonds of series 06 was 27 995 million rubles.

Investors submitted 77 applications for bonds of series 08 with a coupon rate from 6.70% to 7.25% per annum. In the course of marketing the total demand for bonds of series 08 was 39 164.40 million rubles.

Vnesheconombank’s final coupon rates were set on the basis of low price ranges. The interest coupon rate on bonds of series 06 is 7.90% per annum, on bonds of series 08 – 6.90% per annum.

Given the market situation, placement prices, coupon rates on bonds and the current demand, Vnesheconombank made a decision on accepting 48 investors’ applications for bonds of series 06 and 54 investors’ applications for bonds of series 08. The funds raised through placing the said bond issues will be used to finance credit and investment activity of State Corporation ‘Bank for Development and Foreign Economic Affairs (Vnesheconombank)’.

Management Board Member –Vnesheconombank Deputy Chairman Petr Fradkov: “It was very important for us to go ahead with our appropriate credit history and engage a wide range of investors. A successful placement of Vnesheconombank’s bonds has once more confirmed that market players trust it and see it as a reliable state-run institution, which always honors its obligations”.

Jury Solovjev, VTB Capital President: “We are proud that VTB Capital participated in such a large-scale transaction. This is a result of our successful activity on the debt capital markets in the last two and a half years. Vnesheconombank is a system-forming financial institution in Russia. The placement of Vnesheconombank’s bonds is going to become a momentous event for the ruble-denominated bond market. By participating in placing Vnesheconombank’s bonds we enhance the development of the Russian economy”.

Yury Kudimov, VEB Capital Director General: Vnesheconombank’s debut placement of ruble-denominated bonds generated considerable interest among more than 50 Russian and foreign investors. Three and seven-year bonds were placed at low price ranges. Investors’ great demand for the bonds demonstrates that they view Vnesheconombank as a prime borrower on the Russian market.

Troika Dialog’s Business Management Chief Executive Director General Jacques Der Megredichyan: “In our opinion the results of placing VEB’s bonds are very positive despite the increased volatility, which we saw recently just before VEB had closed its bid books. VEB created a new benchmark on the ruble-denominate bond market by offering investors for the first time after the crisis a seven-year issue. Both three-year and seven-year issues were closed with more than a two-fold oversubscription and interest rates were set on the basis of low price ranges thus setting up a record among corporate borrowers.

 Arrangers and underwriters of the bond issues: VTB Capital, VEB Capital, Troika Dialog.

Co-arrangers of placing bonds of series 08: Sberbank of Russia, Bank of Moscow, NOMOS-BANK, co-underwriters of the bond placement: Globex Bank, Bank National Standard.

Co-arrangers of placing bonds of series 06: Sberbank of Russia, Bank Soyuz, Uglemetbank, Gazprombank, co-underwriters of the bond placement: Globex Bank, Promsvyazbank.