Commercial Bank of Qatar, the Gulf country’s second-biggest bank by assets, plans to sell five-year senior and 10-year subordinate-fixed dollar bonds, a banker familiar with the transaction said.
The five-year bond may be priced to yield about 275 basis points above the midswap rate, while the 10-year bond may be priced to yield 400 basis points above the benchmark rate, said the banker who declined to be identified because the transaction isn’t completed.
Commercial Bank may raise about $1 billion from the sales, he said. The money raised will be used to shore up the bank’s Tier II capital that includes items such as undisclosed reserves and subordinated debt, the lender said in a statement last week. Morgan Stanley and Credit Suisse Group AG are managing the sale, another banker familiar with the transaction said last week.
Commercial Bank’s five-year floating rate note, maturing in 2011, was paying 96.5 cents on a dollar at 4:05 p.m. Dubai time, according to RBS Financial Markets prices provided to Bloomberg. The note rose to 97.75 cents on Sept. 17, a 12-month high.END
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