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INTERVIEW-Bank St Pete seeks firm markets for bond deal
June 5, 2012 / 7:42 AM / 5 years ago

INTERVIEW-Bank St Pete seeks firm markets for bond deal

* Awaits better market after failed attempt in April

* Subordinated Eurobond issue needed to improve capital position

* Sees loan book expanding 10-15 pct, depending on debt issue

By Liza Dobkina

ST PETERSBURG, June 5 (Reuters) - Bank St Petersburg (BSPB.MM), one of Russia’s largest listed non-state banks, may issue subordinated Eurobonds once markets improve as it seeks to fulfil its lending growth target, a d eputy chairman of the management board told Reuters.

The lender had held a roadshow to test investors’ appetite towards a new Eurobond issue in April, but postponed the deal due to weak markets affected by the deepening euro zone debt crisis. [ID:nL6E8FJETV]

“Unfortunately, the global situation had changed and we did not announce the deal. But we will try again when the next window appears,” Konstantin Balandin said in a recent interview.

He added that a subordinated debt issue is needed to improve the lender’s Tier 2 capital adequacy ratio.

The bank’s total capital adequacy ratio, which includes Tier 1 and Tier 2, stood at 13.92 percent at the end of last year, well above an 8 percent minimum requirement.

Bank St Petersburg, in which the European Bank for Reconstruction and Development (EBRD) holds a 6.2 percent stake, plans to report first-quarter results on June 8.

Before the global risk aversion last month cut investor interest towards emerging markets, including Russia, local borrowers managed to raise just over $18 billion via Eurobond issues this year.

Balandin added that achieving the lender’s loan growth target for this year, set at between 10 and 15 percent, will depend on how successful the Eurobond issue might be.

”If we manage to do it we will be close to the high end of the (loan growth) range but if we fail to place subordinated debt in any form... we are likely to be close to the lower end

(of the forecast),” he said.

Bank St Petersburg, just over 50 percent owned by its top-management including chairman Alexander Savelyev, saw its loan book expand by 14.3 percent last year.

The lender posted 5.88 billion roubles ($174.42 million) in last year’s net profit, up 43 percent year-on-year, but below market expectations due to increased provisions on bad loans. [ID:nR4E8DA007]

($1 = 33.7117 Russian roubles)

(Writing by Katya Golubkova; Editing by Megan Davies and Muralikumar Anantharaman)

((ekaterina.golubkova@thomsonreuters.com)(+7 495 775 1242)) Keywords: BANKSTPETERSBURG EUROBOND/

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