KUWAIT: Kuwait’s Burgan Bank raised $400 million in a 10-year bond sale on Thursday, at a coupon rate of 7.875 percent.
The dollar-denominated bond sale attracted a final book size of $1.5 billion, one source with a lead bank said, signalling the issue was oversubscribed nearly four times by investors.
Burgan Bank is the commercial banking arm of Kuwait Projects Co (KIPCO), the country’s largest investment company by assets, which priced a $500 million 10-year bond in July at 9.5 percent.
Joint lead managers on the issue are Morgan Stanley, JP Morgan and Standard Chartered.
Kuwaiti investment firms have been badly hit by the financial crisis and some have said they would sell down international assets.
There is a pipeline of Gulf Arab bond sales waiting to come to market but volatility due to Europe’s debt crisis has slowed issuance from the region, with issuers wary of higher pricing and jittery global investors.
Much of the issuance so far this year has been from government-linked issuers, but capital needs for the region’s corporates should move more companies to issue in the second half of the year, market conditions permitting.
