A syndicated loan raised by the EBRD for Rosbank, a Russian private bank controlled by France’s Societe Generale group, has been heavily oversubscribed and the total loan amount nearly doubled to USD 290 million due to strong interest from commercial banks.
A total of 11 international banks are participating in the USD 230 million syndication under an EBRD A/B loan structure. The pricing of this B loan is 1.75 per cent over LIBOR. The EBRD is in addition providing a USD 60 million A loan and remains the lender of record for the full amount of USD 290 million.
The maturity of the EBRD A loan is three years whereas that of the syndicated B portion is one year – with an option to extend for another year at the discretion of each B-lender.
The outstanding success of this transaction, coming as it does against a background of dramatically lower syndications volumes on world markets, and particularly in Russia, marks a major step towards the reopening of this segment of the international debt markets to Russian private banks.
The volume of syndicated loans provided by international banks to Russian borrowers fell by 64 per cent in the first nine months of 2012. The overall drop worldwide in syndication volumes was 22 per cent over the same period.
Despite US dollar funding difficulties faced by many European banks at the beginning of this year due to the eurozone sovereign debt crisis, the loan was oversubscribed even though it was denominated in dollars and included several European banks in the lending syndicate.
Most Russian banks tapping the syndicated market are state-owned and this transaction for a private bank also differs from the usual pattern in present market conditions in that it does not involve a loan renewal or extension, any refinancing or a club deal. This makes it one of the very few, genuinely new syndications by Russian private banks this year.