Fixed Income Analysis /
Russia

Alfa Fixed Income Weekly: Ruble bond market

  • The Finance Ministry auctions last Wednesday were in line with the trends of the previous week

  • The OFZ curve on a weekly basis rose 14-22 bp and the 10-year OFZ closed at 7.30%

  • On the corporate debt market, borrowers either continued their placements or plan to enter the market with offers

Elizaveta Naumova
Elizaveta Naumova

Senior Fixed Income Analyst

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Alfa
13 April 2021
Published byAlfa

The Finance Ministry auctions last Wednesday were in line with the trends of the previous week, ie state banks were again the key buyers. This time the MinFin decided to attract rather long issues – with a date-to-maturity in 2031. (OFZ-FI 26235) and in 2035 (OFZ-FI 26233) with yields at the market close on Tuesday at attractive levels of 7.24% and 7.33%, respectively. The total volume of demand during the auctions totaled RUB120 bn while the placement volume equaled RUB 92 bn. The largest bid was the one at the first auction (RUB 30 bn), at the second auction there were three large bids (RUB 8-9 bn each), which totaled about 60% of the placement. The MinFin granted little if any premiums to the secondary market due to the elevated yields because of the escalation of geopolitical tension. The OFZ curve on a weekly basis rose 14-22 bp and the 10-year OFZ closed at 7.30%.

On the corporate debt market, borrowers either continued their placements or plan to enter the market with offers: YATEK placed its 4-year amortised issue for RUB5 bn at 9.15% per annum; Sberbank placed its 5-year bond for RUB 14 bn at 7.45% per annum. Alfa-Bank’s bid book for its 3-year bonds with a target coupon at 6.8-7.0% per annum will be opened until 14 April. This week Saint-Petersburg developer Setl Group will open its bid book for a 3-year issue.