Running a state budget deficit and facing a prolonged period of civil unrest, Bahrain is not in the same league for investors as the Gulf's wealthier oil exporters. But good timing and strong demand for regional assets in general mean a planned bond issue by the tiny kingdom is likely to go well.
Bahrain is sounding out investor appetite at roadshows this week for a possible issue of an international, conventional bond. Bankers said Bahrain's first conventional debt offering since 2010 would be open to qualified investors in the United States and elsewhere, and might be as large as $1.25 billion.
Bahrain last tapped the international market in November with a $750 million, seven-year sukuk (Islamic bond), which was largely sold to investors in the Middle East. The upcoming issue will not be able to count on interest from a deep pool of Islamic investment money in the Gulf, so it will be a tougher test of market confidence in Bahrain.
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