People who believe that the demand for ten-year Eurobonds of the Russian Finance Ministry was “exaggerated”, do not understand the question or do not possess the information, said the head of VTB Andrey Kostin in an interview to “Vesti. Economy” on Wednesday.
“The newspaper “Vedomosti” wrote that the demand was exaggerated. But either they have the wrong information — they need to check the sources, or they do not know what you write”, — said the banker told.
He noted that a situation when due to high competition investors apply for more money than they plan to spend, to happen “always”. “If the whole talk about a good location, it is always, when in great demand, and investors expect that there will be a competition, then they certainly apply “higher” to anything went — so I always do”, — said Kostin.
The head of VTB added that the demand for new Russian Eurobonds proved to be “very high”. “We have already felt it — we have broken phones,” he said.
The geography of demand — the US, UK, continental Europe, Asia and Russia, said Costin. But the government immediately pointed the placement agent — VTB Capital” — that the Russian participants should be no more than one-third, he said. As a result, only 25% of the issue bought by Russian investors, the rest foreign.
The Ministry of Finance on Monday, 23 may, announced the location of ten-year dollar-denominated Eurobonds. By the evening of that day the volume of applications received from investors was significantly higher than the planned volume of placement, said sources in the investment companies. One of them noted that the placement agent would like to place at least $1 billion, and the oversubscription amounted to $5.5 billion.
In turn, the newspaper “Vedomosti” on Wednesday, wrote with reference to one of the market participants that the demand for Eurobonds of the Ministry of Finance was “exaggerated”. “The company has applied for a much larger sum than was going to buy. The idea is to get something under competition: an application for one hundred million to get one. And when the application is approved, and it is possible to reduce”, — explained the interlocutor of the edition.
On Tuesday evening the Ministry of Finance has closed the bid book. The Ministry reported that the volume of securities sold was $1.75 billion, the rate of return is 4.75% per annum, the total amount of the order book is about $7 billion About $1.2 billion bought by foreign participants, about $550 million to Russian banks, said Wednesday the Minister of Finance Anton Siluanov.