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25/04/2012 - VTB CAPITAL Plc TL 300 million Debut Turkish Lira Bond Offering
VTB Capital Plc have successfully completed a TL 300 million three year debut domestic bond offering in Turkey last week on April 20th.

 VTB Capital Plc have successfully completed a TL 300 million three year debut domestic bond offering in Turkey last week on April 20th . The bond carries a coupon of 11.28% paid semi-annually and final maturity of 17 April 2015. The transaction carries a significant importance as it is the first time a foreign borrower is tapping the domestic bond markets in Turkey in local currency in the back end of the domestic corporate bond yield curve which to date has only been accessed by only one other local issuer. The transaction is expected to set the precedence for other international borrowers to explore opportunities in the Turkish domestic bond markets offering different credit profiles to domestic investors on the same Turkish Lira rate curve .The debut transaction will have a positive impact in the development of Turkish Capital Markets and the governments aim of making Istanbul an international financial center stated Fokus Yatirim Holding, the sole advisor to VTB Capital Plc in the issue. VTB's landmark transaction was done through Garanti Bank's agency.
 
Fokus Yatirim Holding ( www.fokusholding.com ) is an asset management and advisory services firm based in Istanbul, Turkey founded by Messrs Kubilay Cinemre, Uzay Kozak and Faruk Isik.

25/04/2012 - 07:27:51.803 GMT (Bloomberg), By Benjamin Harvey
VTB Group’s sale of lira bonds in Turkey paves the way for corporate lira bonds on the domestic market that aren’t limited by Turkey’s sovereign ratings, Fokus Yatirim Holding AS’s Kubilay Cinemre said.
The Russian state-owned bank’s 300 million lira bond sale is the first foreign bond issuance approved by Turkey’s Capital Markets Board and the bonds will be the first foreign bonds traded on the Istanbul Stock Exchange, Cinemre, whose Fokus Yatirim was sole adviser on the sale, said in an interview yesterday.
 
“This is going to be a well-traveled path and is going to enlarge the Turkish capital market,” Cinemre said in a telephone call from Istanbul. “Basically, it gives an opportunity for creating a real domestic corporate bond market because the credit profile will matter.”
 
Previous lira bond issuances by foreign entities were all offshore and delivered returns through swaps, Cinemre said. Lira bonds issued within Turkey by local firms are limited by the country’s sub-investment grade credit rating, he said.
 
S&P rates debt for Turkey, a European Union candidate, as junk at BB, on par with Macedonia, Portugal and Jordan and one level above Mongolia and Vietnam. Fitch Ratings ranks the country at BB+, one step below investment-grade, and Moody’s Investors Service rates Turkey Ba2, two steps below.
 
“Since VTB’s bond is the first of its kind, you could buy a Turkish carry trade with a different profile than Turkey,” Cinemre said. “Let’s say the oil price is increasing, Russia is going to do better, and VTB is the second-biggest bank in Russia. You like the carry trade in Turkey but you don’t like the credit profile of Turkey; in that situation, this is the trade for you.”

Carry Trade

The yield on the country’s two-year benchmark government bonds was 9.45 percent at the close in Istanbul yesterday.

VTB Capital Plc, the investment-banking arm of VTB Group that sold the three-year bonds, did so at a yield of 11.28 percent, the group said in an e-mailed statement from Moscow on April 23. The sale was the largest corporate lira bond sale on the domestic bond market for a period of three years that wasn’t at a floating rate, Cinemre said.

Akbank TAS, the Turkish bank part-owned by Citigroup Inc., sold 390 million liras of three-year floating rate bonds in January.

“If Turkey really wants to be a global financial center, it needs to have a diverse capital market,” Cinemre said.

Fokus specializes in advisory and asset management services. Cinemre owns the company with Faruk Isik, formerly chairman of Bank of America in Turkey, and Uzay Kozak, ex-chief executive of the Turkish unit of Lehman Brothers Holdings Inc.