EBRD Places Series 08 Bonds
OREANDA-NEWS. November 03, 2010. The European Bank for Reconstruction and Development (EBRD) completed its MICEX listing of series 08 bonds with nominal value of R7 bln and maturity 2920 days from the date of sale commencement.
The bonds stipulate payment of a fixed coupon yield and additional returns, the amount of which will depend upon the dynamic of the RDX index and fluctuations in the U.S. dollar-Russian ruble exchange rate.
On October 27, the EBRD set the amount of the “participation coefficient,” which determines the bondholder’s participation (share) in positive movements of the RDX index throughout the entire period of bond circulation, at 0,52 (52%). The RDX index is a capitalization-weighted price index reflecting price movements in the most liquid depository receipts on Russian stocks – blue-chips trading on the London Stock Exchange (LSE). Such a structure makes the EBRD bond an analogue of bonds with principal protection, for which there is considerable demand among conservative investors with long-term cash investments. The product offers the highest possible credit quality given the AAA rating of the borrower.
According to Pavel Sokolov, Deputy Head of Investment Banking at Troika Dialog, "We think that such instruments will be attractive for Russian and foreign borrowers and investors. I think there will be more such transactions next year."
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