Commercial Bank successfully issues $750m five-year bond

 19 Jun 2016 - 8:34

Commercial Bank successfully  issues $750m five-year bond

 

DOHA: The Commercial Bank recently announced the successful issuance and pricing of a $750m five-year senior unsecured bond under the Bank and its subsidiary, CBQ Finance Limited’s $5bn European Medium Term Note (EMTN) Programme. 
The issue was arranged and offered through a syndicate of Joint Lead Managers comprising Citibank, HSBC, Morgan Stanley and National Bank of Abu Dhabi and attracted substantial global interest.
To support the issue, representatives from Commercial Bank embarked on a road-show with the Joint Lead Managers to meet investors in London, Singapore, Hong Kong and the UAE. During the road-show, they visited financial institutions, pension funds, asset managers and supranational bodies, and held one-to-one and group meetings in the countries visited. 
Following the end of the road-show, the transaction saw strong demand, with a total $1.7bn order book (an oversubscription by approximately x 2.25) allowing Commercial Bank to tighten the final spread and the coupon below the initial price thoughts for the transaction. The bond was issued at a spread of 215 basis points over mid-swaps, carries a coupon of 3.25 percent and has a final reoffer yield of 3.385 percent per annum. The spread was the tightest achieved by a Mena financial institution in 2016 (for both conventional and Sukuk) and the coupon is also the lowest for a Mena conventional financial institution since May 2015, reflecting strong investor appetite. The net proceeds of the issue will be used for general funding purposes to support the strategic growth plans of the Bank.
High quality investors from the global community participated in this issue, with the majority of investors from the Middle East (34 percent ) and Europe (33 percent ), followed by Asia (18 percent ) and the UK (13 percent ). The investor base is diversified, including some of the world’s leading fixed income investors, with strong demand from fund managers, hedge funds, other banks and Qatari institutions.
Abdulla Saleh Al Raisi (pictured), CEO, Commercial Bank, said: “This $750m transaction is the largest of its type in the region for over a year from a financial institution and we are delighted by the investor response to our issuance under Commercial Bank’s EMTN Programme. 
The market demand and attractive pricing is a clear indication of the continuing confidence of international investors in the strength and economic stability of Qatar, and is testament to Commercial Bank’s strategy, financial strength and prudent management.”

The Peninsula