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Sberbank poised to price tight Tier 2 

February 19, 2014
Davide Scigliuzzo, IFR

Sberbank is seen offering a tiny concession on its upcoming issue of a subordinated 10-year non-call five bond, a deal closely watched by the market as a key test for Russian bank capital transactions.

With initial price thoughts of the 5.625% area, the new issue is coming at around 400bp over five-year mid-swaps, according to bankers away from the trade.

This is some 60bp back of Sberbank’s outstanding new-style 2023 Tier 2 notes, which were spotted trading at a z-spread of 340bp on Tuesday morning.

While both notes are Basel-III compliant and subject to the same loss-absorption features, the 2023 issue is a bullet maturity, while the new 2024s have a one-time call in year five.

Read more: IFR

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