URALSIB Capital was a partner in organizing the Euromoney Bond Investors Congress
URALSIB Capital was a partner in organizing the Euromoney Bond Investors Congress, held on 24-25 February 2010 in London.
Congress participants focused on regulatory changes, prospects for hybrid products and secured bonds in European capital markets, discussed strategies in the high yield bond market, derivatives market development, and the future of global financial institutions.
As part of the congress URALSIB Capital sponsored a special session on the Russian Debt Market – Vision for Development Paths. All participants recognized the relevance of this discussion as the Russian debt market has recovered after the crisis and Russia is expected to tap the sovereign debt market in 2010–2012. The session centered on the issue of targeting the relative proportions of ruble bond and Eurobond issuance.
In his key-note address, URALSIB Capital’s chief economist Vladimir Tikhomirov said he believed that as the economic crisis is not yet behind us, investments in fixed income instruments will prove more defensive than those in equities. Meanwhile market players’ increasing inflation fears still raise concern. In general, 2010 will see no groundbreaking economic developments, with Russia’s dependence on the global economy persisting. If the situation in the global economy continues to improve, Russia’s 2010 GDP will rise 5.5% YoY, industrial output will expand 8.2%, the dollar-ruble exchange rate will hover at around RUB28/$, with the oil price staying close to $75/bbl.
URALSIB Capital’s Fixed Income chief Boris Ginzburg emphasized in his presentation that the Russian domestic debt market is currently offering very interesting opportunities, with single-digit interest rates available even to second-tier borrowers. In his view, the current market situation presents a new challenge for the entire bond industry – that of securing high quality bond issues as their sizes increase. Despite the strong demand, Russian corporate Eurobonds, including banking issues, are still cheap from the standpoint of their credit spreads versus the pre-crisis period.
URALSIB Capital’s Head of Fixed Income Research Dmitry Dudkin believes Russian borrowers’ debt burden is not heavy by any standards. The Russian Eurobond market recovery is in his view a fait accomplis, while Russia’s sovereign debt is still cheap versus that of other emerging markets. There are still interesting opportunities for Eurobond issuance in the corporate, especially financial, sector. At the same time, Dmitri Dudkin believes Russian borrowers are currently less enthusiastic about foreign currency-denominated bond issuance, with Eurobond issues confined mostly to the largest exporters and banks. The abundance of liquidity on the domestic market supports demand for ruble-denominated debt instruments; the ruble continues to strengthen and inflation expectations are now low, encouraging unhedged participation in the ruble debt market.
The Euromoney Bond Investors Congress is a major annual international event for investors in fixed income instruments (bonds, bills of exchange and promissory notes). Major investment houses, investors and financial authorities’ spokespeople as well as economists make forecasts and discuss recent investment and risk management trends in the form of presentations and panel discussions. In 2010 the forum saw more than 560 participants from 50 counties, including executives and staff members of UBS, JP Morgan, Soci?t? G?n?rale Corporate & Investment Banking, Schroders Investment Management, Lombard Street Research, Morgan Stanley, HSBC, Aberdeen Asset Management, Axa Investment Managers, BNP Paribas, Goldman Sachs, Credit Suisse, Barclays Global, the Bank of England and the Financial Services Authority as well as UK’s Shadow Treasury Minister Greg Hands, MP.
http://www.euromoneyconferences.com/EventDetails/0/1047/The-Bond-Investors-Congress.html
25 February 2010
