TBC Capital acted as the sole placement agent for a Georgian Lari denominated bond issued by the Black Sea Trade & Development Bank (BSTDB) on 5 November 2015. The 3-year floating-rate bond totaling GEL 45 million (approximately USD 20 million) is BSTDB's first-ever sale of bonds denominated in Georgian Lari and will help to support the development of the country’s capital market and provide funding to smaller businesses.
The proceeds of the bond issue will be used by BSTDB to extend a loan to TBC Bank, to support the provision of investment and working capital loans to small and medium-sized enterprises (SMEs) in Georgia. This GEL denominated SME loan facility will complement the existing USD 10 million SME Loan Facility and the USD 10 million Trade Finance Facility with TBC Bank.
Commenting on the deal, the BSTDB President, Ihsan Ugur Delikanli said: “Building on the strong cooperation we have developed with TBC Bank, this transaction is very important for BSTDB. Not only because the bond issue will assist with the development of the local debt capital market, but also because the loan to TBC Bank, made with the proceeds, will support economic growth and job creation in Georgia and eliminate FX risk. This transaction shows our innovative approach and increasing capacity to meet market demands; we hope that this deal will pave the way to similar bond issuances to finance our local currency investments in all our member countries”.
“We are delighted to continue our partnership with BSTDB. The transaction is of great importance not only for TBC Bank but for the entire financial sector as it enables us to provide loans in local currency that are increasingly in demand from our customers and will enable TBC Bank to further strengthen its position in the SME segment. This transaction reflects both institutions’ commitment to continue cooperation and we look forward to more years of productive partnership. In addition, the issuance of the bonds will support local capital market development,” commented Vakhtang Butskhrikidze, CEO of TBC Bank.
“At TBC Capital we are fully committed to playing an active role in promoting capital market development in Georgia, which still remains at a nascent stage, but has been receiving increasing attention in recent years. The issuance of BSTDB bonds, comes just a few months after the largest local bond issue in Georgia, which was also arranged by TBC Capital. I would like to thank BSTDB for their cooperation in this important deal.” George Shengelia, Managing Director of TBC Capital
The issue carries BSTDB’s A-/A2 credit ratings and meets the National Bank of Georgia’s quality requirement as a liquid asset for Georgian banks.
BSTDB sold the 3-year bonds at a price of par, with a floating rate coupon that resets quarterly based on the National Bank of Georgia’s 3-month Certificate of Deposit. The bonds will mature on 1st November 2018.
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JSC TBC Bank is a leading universal bank in Georgia, offering a broad range of products and services through its extensively developed corporate, retail, SME and micro banking business lines. As at 30 June 2015, TBC's loan book comprised retail, corporate, SME and micro portfolios with 43%, 33%, 13% and 11%, respectively, of the total loan portfolio. TBC Bank is the market leader in Georgia in retail deposits with a 34% market share. In terms of total assets and total loans TBC retains a leading position with market shares of 26% and 28% respectively as at 30 June 2015. TBC Bank is assigned BB- (Long-Term IDR) / B (Short-Term IDR) rating from Fitch and B1 (Fgn Curr) / Ba3 (Dom Curr) from Moody's.
The Black Sea Trade and Development Bank (BSTDB) is an international financial institution established by Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Turkey, and Ukraine. The BSTDB headquarters are in Thessaloniki, Greece. BSTDB supports economic development and regional cooperation by providing loans, credit lines, equity and guarantees for projects and trade financing in the public and private sectors in its member countries. The authorized capital of the Bank is EUR 3.45 billion. BSTDB is rated long-term “A-” by Standard and Poor’s and “A2” by Moody’s. For information on BSTDB, visit www.bstdb.org.
TBC Capital is an advisory arm of TBC Bank offering Corporate Advisory, Research and Brokerage solutions in Georgia. Company is committed to playing an active role in the development of capital markets in Georgia. TBC Capital supports both institutional and strategic investors in exploring investment opportunities in Georgia while at the same time giving access to additional forms of financing to domestic companies. For more information please visit our web-page: www.tbccapital.ge
BSTDB: Haroula Christodoulou
Tel: + 30 2310 29 05 33
TBC Bank t: Tamuna Kakulia
Tel: + 995 32 2 27 27 27
TBC Capital: George Shengelia
Tel: + 995 32 2 27 27 27