Romanian investors express major interest in IIB, spurring demand for RON 111 million worth of bonds in IIB’s first local currency issue outside of the country of its headquarters
The International Investment Bank placed RON 111 million (approx. EUR 25 million) of 3-year bonds on the Bucharest Stock Exchange. The interest rate of the issue, organised by BT Securities S. A., a subsidiary of Banca Transilvania S. A., was set at 4.1%. The fully domestic issue attracted demand from Romanian pension and investment funds, as well as investment and insurance companies.
Investors rallied after a roadshow organised in Bucharest on October 6 with the participation of Nikolay Kosov, Chairman of the IIB Board, who turned the Bank around in 2012. Since then, the IIB has transformed into a modern multilateral development institution, and received two investment grade ratings from Moody’s and Fitch, which allowed it to enter debt capital markets in April 2014 and to remain an active issuer ever since, raising so far an equivalent of over EUR 200 million in five issues in Romania, Slovakia and Russia.
In the run-up to the placement, the IIB enjoyed strong support from the Ministry of Public Finance of Romania, represented in the IIB Council by Attila Gyorgy, State Secretary of the Ministry and head of the Romanian delegation at the IIB. In 2015, Romania has advanced its membership in the Bank, also having signed its new statutory documents, therefore bringing it closer to the beginning of a new era in its evolution.
Denis Ivanov, Deputy Chairman of the IIB Board, who rang the bell at the opening of the trading session on the Bucharest Stock Exchange on October 15, when IIB’s bond was listed, commented: «This bond is not only IIB’s first local currency bond outside of the country of our headquarters, but it is also significant in two major ways. First, after Russia and Slovakia, Romania is the third country where we have committed ourselves to the development of the local capital market. And secondly, as testified by our latest transactions, Romania has become one of the leading destinations for our investments and today’s bond will allow us to further support this growth of our operations in the country. In this sense, the IIB aims to channel the liquidity on the market to sustainable and socially viable economic activities.»
«This has been a fruitful year for BT Securities. Through its new Corporate business line, BTS has assisted a series of companies in the stock exchange trading process and has intermediated two major bond issues: for International Investment Bank and for the Bucharest Town Hall, the latter in amount of EUR 500 million», added Paul Prodan, Chairman of the Board of BT Securities, speaking at the event. Other speakers at the ceremony of the opening of the trading session included the Romanian regulator — FSA — as well as the Ministry of Public Finance, which was also represented by Attila Gyorgy.
The issue is the largest concluded in Romania by any international financial institution in the past six years, including the most recent issues by the EBRD, the EIB and the BSTDB of RON 100 million, RON 88 million and RON 22 million respectively, reflecting IIB’s commitment to the local market and investors' confidence in the institution.
Although in the past decades the IIB did not conduct wider operations in Romania, this has changed significantly since the beginning of its transformation in 2012. Currently, active investments of the Bank in the country amount to EUR 35 million.
BT Securities — the brokerage company of Banca Transilvania Financial Group is the largest retail broker in Romania. During its 14 years of activity, BTS has successfully intermediated a series of primary and secondary offers of shares and municipal and corporate bonds. BT Securities intermediates transactions on the Bucharest Stock Exchange and the Vienna Stock Exchange, where clients can trade either with the help of experienced brokers or via the online trading platform — BT Trade.