Bahrain hires banks for second bond issuance of 2020

Bahrain plans to issue seven-year sukuk as well as 12-year conventional bonds and/or 30-year conventional bonds. (AFP file photo)
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Updated 08 September 2020

Bahrain hires banks for second bond issuance of 2020

  • Gulf oil producer raised $2 billion in May to bolster finances battered by low oil prices and the coronavirus crisis

DUBAI: Bahrain has hired banks to arrange a multi-tranche sale of US dollar-denominated sukuk and bonds that would be the country’s second bond issue this year, a document from one of the banks arranging the deal showed on Tuesday.
The oil producer, which averted a credit crunch in 2018 with a $10 billion aid package from its wealthy Gulf neighbors, raised $2 billion in May to bolster finances battered by low oil prices and the coronavirus crisis.
“Appetite for yield is high at the moment so I think demand will be high for Bahrain, as it’s perceived as a lower-rated country backed by the rest of the GCC,” said Raffaele Bertoni, head of debt capital markets at Gulf Investment Corporation, referring to the six-member Gulf Cooperation Council.
Bahrain, rated B+ by S&P and Fitch, hired Bank ABC, Citi, Gulf International Bank, HSBC, National Bank of Bahrain and Standard Chartered to arrange an investor call on Tuesday, the document said. It plans to issue seven-year sukuk, or Sharia-compliant bonds, as well as 12-year conventional bonds and/or 30-year conventional bonds, subject to market conditions.
“They will have no difficulty placing the shorter-dated sukuk with regional investors. Pricing on the 12-year or possible 30-year bond will be driven by international investors,” said Doug Bitcon, head of credit strategies at Rasmala Investment Bank.
A fixed income strategist expected the sukuk to be priced to yield around 4.5 percent and the 12-year bonds around 5.5 percent, adding there was an expectation among investors that further Gulf aid for Bahrain would be forthcoming if needed.
“The 30-year could be priced around 6.25 percent, which is significant since Bahrain issued four-year sukuk in May this year at that level,” he said.


Emirates stops flights to three major Australian cities

Updated 16 January 2021

Emirates stops flights to three major Australian cities

  • Flights to/from Sydney, Brisbane and Melbourne will be suspended until further notice: Emirates
  • The airline will still run two flights a week to Perth

DUBAI: Emirates has suspended flights to Australia's three largest cities as the country further restricts international arrivals over fears of new virus strains.
The Dubai-based carrier was one of the last to maintain routes into and out of the country's east coast throughout most of the pandemic but on Friday evening told travellers a handful of planned flights next week would be the last.
"Due to operational reasons, Emirates flights to/from Sydney, Brisbane and Melbourne will be suspended until further notice," Emirates said on its website.
The airline will still run two flights a week to Perth, but the cuts are another barrier for tens of thousands of stranded Australians still attempting to return home.
The Australian government responded by announcing more repatriation flights and said other carriers still flying services to the cities could fill the gap.
"The capacity that Emirates was able to use within the cap will be allocated to other airlines, ensuring that there are still as many tickets, as many seats available into Australia," Finance Minister Simon Birmingham said.
A small number of airlines - including Qatar Airways and Singapore Airlines - are still running services to Australia but local media were already reporting delays and cancellations among returning travellers.
Australia's borders have effectively been closed since March to curb the spread of the virus, with the government even limiting the number of citizens allowed to return.
Last week travel restrictions were further tightened, with arrival numbers slashed and all travellers into the country requiring a negative Covid-19 test before flying.
In making the changes, Prime Minister Scott Morrison cited a growing number of people in quarantine testing positive for new strains of Covid-19.
Fears that a variant of the virus from Britain, believed to be more contagious, had leaked into Brisbane from hotel quarantine triggered a snap lockdown in the city last week.
"There are many unknowns and uncertainties in relation to the new strain, and so that's why this precautionary approach, we believe, is very sensible," Morrison said.
Australia continues to deal relatively well with the virus, having recorded about 28,600 cases and 909 deaths linked to Covid-19 in a population of 25 million.