Alfa-Bank successfully closed RUB 10 bn Eurobond issue

On February 10, 2017, AO «ALFA-BANK» successfully priced the 5 years RUB Eurobond issue totaling RUB 10 bn. The coupon rate is fixed at 9.25% per annum.

As a result of the thorough research of the broad investor base Alfa-Bank has decided to approach the market with a RUR Eurobond offering. Due to the large interest shown by the major global investors (the demand exceeded RUB 20 bn), Alfa-Bank lowered the initial price range of 9,25 — 9,50% and managed to fix the final coupon rate at the lower end of the range for the RUB 10 bn issue maturing in 5 years. The final order book comprises of over 30 orders of investors from various financial centers in Europe, Asia, Middle Eastern countries and, of course, from Russia.

Alexei Tchoukhlov, Deputy Chairman of the Executive Board and Chief Financial Officer, when commenting on the placement results, noted, «We are satisfied with the demand shown by the investors and believe that the issue was placed successfully and at the right time. As the matter of fact we not only raised funds in Russian rubles for 5 years at the coupon rate below the rate at which we placed 3-year local bonds early this year (9.45% per annum, RUB 5 bn), we also managed to accomplish our goal to build on strong foreign demand: the share of foreign orders was 72% of the issue amount.

It is worth to note that in April 2013 Alfa-Bank, having established its LPN Programme, placed 3-year RUB Eurobonds (for RUB 10 bn.), which is still the first-ever and only issue of RUB Eurobonds by a Russian non-governmental bank. Since then, there have been a number of events causing material volatility on the financial markets. Nevertheless, having assessed the long period of stability of the RUB exchange rate against the major currencies, Alfa-Bank decided to return on the Euroruble market and again it became the first and only private Russian financial institution on that market after almost 4 years. We expect that our issue will become a benchmark for subsequent borrowings by Russian issuers in RUB on the international capital markets.»

The notes were issued by Alfa Bond Issuance plc, Ireland. The issue was under the Bank’s LPN Programme under RegS. The joint lead managers are Alfa-Bank and JP Morgan.