OREANDA-NEWS.  June 24, 2014. The International Bank of Azerbaijan (“IBA”) had succesfully closed  its debut RegSissue of 5-year bonds in an amount of USD500 million with a coupon and yield of 5.625%.

The IBA’s issuance receivedBa3/BB rating from Moody’s and Fitch respectively and was led by JPMorganand CITIas the joint book runners of the deal. Legal support was provided by Baker & McKenzie ascounsel of the issuer and by White & Case as counsel of the joint lead managers.

The IBA delegation, led by the Deputy Chairman and CFO Rashad Hajiyev, conducted a 4-day roadshow visiting London, Frankfurt, Geneva and Zurich. Over 50 high profile accounts were met and the story was well received.

On the last day of the road show, the 5 year tenor and initial price guidance at high 5%s was communicated to the market. Investors were engaged and the orderbook grew quickly, allowing IBA to revise the guidance to 5.75% area on the next day and subsequently priced at 5.625% yield and coupon, equivalent to MS+389 bps in spread terms. The final orderbook reached around US\\$1bn.

The majority of investors participated in the offering are fund managers at 73%, followed by banks/private banks at 27%. In terms of geography, the offering was primarily oriented towards investors from Europe (UK 31%, Germany 24%, Switzerland 22%, other Europe 14%), and also included a number of offshore US accounts (9%).

The use of proceeds is for general corporate purposes and refinancing of IBA’s short-term borrowings.

The IBA team was very pleased with the final results of this inaugural bond issue and the level of support from investors.

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