Corporate bond issuance - an alternative way of financing your business offered by the Bank
Today, cooperation with Bank opens up new opportunities for customers and allows them achieve their investment goals in the financial services market worldwide. A bespoke approach to every single customer and a vast array of financial products allow customer and Bank to find maximally advantageous financial solutions.
In an effort to provide its current and potential customers with diverse external finance-raising opportunities, Baltic International Bank presents a new service - arrangement of primary bond issues!
“Corporate companies predominantly use bank loans for financing. Issuance of own bonds is an attractive financing alternative! Flexible terms aligned with market interest rate, and publicly accessible credit history - these are only a few factors that boost the attractiveness of bond issuance”, the Head of Corporate Finance of Baltic International Bank Oleg Doronin says.
For the issuer, arranging a bond issuance is a serious and responsible thing to do. A wise thing to do is to ensure that he bond-issue process is arranged by a professional arranger.Oleg Doronin, Head of Corporate Finance of Baltic International Bank
“Corporate bond issuance has widely picked up worldwide as a mean to raise financial resources. For instance, in the end of March 2018 the volume of outstanding corporate bonds issued by issuers from Poland reached nearly EUR 33 billion or 8 percent of GDP, in the Czech Republic the number was – EUR 26 billion or 15 percent of GDP, and in Hungary– EUR 11 billion or 10 percent of GDP. Bond issues gradually, albeit steadily, are gaining popularity also in the Baltic States. In 2017 alone, the Latvian issuers issued bonds worth EUR 661 million. The Lithuanian issuers issued bonds worth EUR 309 million. Estonian companies issued bonds worth EUR 118 million. Latvia takes the lead in terms of the total volume of bond issues. In March 2018, the total volume of outstanding corporate bonds reached EUR 1.8 billion. The total capitalisation of the Baltic market attained the level of EUR 4 billion. We expect that he Baltic corporate bond market will continue to grow in future, and it will be beneficial for both issuers and investors!" outlines the Director of Corporate Finance, Oto Davidovs.
The total capitalisation of the Baltic market attained the level of EUR 4 billion. We expect that the Baltic corporate bond market will continue to grow in future, and it will be beneficial for both issuers and investors!Oto Davidovs, Director of Corporate Finance of Baltic International Bank
Initially, Baltic International Bank intends to work with small-cap and mid-cap companies whose issue volumes total up to EUR 50 million. The main emphasis will be placed on manufacturing companies based in the Baltic States and Eastern Europe from such industries as timber processing, production of electrical equipment, construction and others.
In the current situation of deficit of debt financial instruments among institutional and private investors, corporate bond issuance is a particularly topical opportunity. An investor buys a bond in the primary market, redeems the bond at the date specified during the placement period, and earns a guaranteed fixed-income regardless of market fluctuations. Furthermore, the investor can sell the bond through the secondary market without waiting until the maturity date, if the investor is satisfied with the bond’s price.
Bond issuance arrangement signifies a new stage in the Bank’s development and will foster substantial reinforcement of the Bank’s position in the global market of investment and banking services!