Wednesday, Jun 27, 2012
DUBAI (Zawya Dow Jones)--The kingdom of Bahrain has launched a $1.5 billion, 10-year bond, after receiving strong demand, a banker aware of the transaction said Wednesday.
The bond was priced at 437.5 basis points over midswaps, tighter than the initial guidance of around 462.5 basis points over midswaps, the banker, who declined to be identified, told Zawya Dow Jones.
Citigroup, Gulf International Bank, JP Morgan and Standard Chartered are book runners for the issue, after the banks helped arrange investor meetings for Bahrain in the U.S., Europe, Asia and the Middle East starting last week.
Bahrain, which is seen to have strong political and economic backing from its oil-rich neighbour Saudi Arabia, last issued an Islamic bond, or sukuk, in November 2011.
Demand for the latest bond offering will help ease some concerns about investor appetite for the kingdom in the aftermath of the mass protests last year that left the country's economy paralyzed at some times.
The International Monetary Fund, in its latest Article IV report on Bahrain, said while the impact of last year's unrest on the economy was cushioned by high oil and commodity prices, the country needs to adopt policies geared to restoring confidence in the economy.
Bahrain's real GDP grew 1.8% in 2011, according to the IMF. Economists expect that higher oil prices and strong government spending will push GDP growth up to 3.8% in 2012.
-By Nikhil Lohade, Dow Jones Newswires; +9714 446-1694; nikhil.lohade@dowjones.com; Twitter: @ZDJnews
Copyright (c) 2012 Dow Jones & Co.
(END) Dow Jones Newswires
27-06-12 1231GMT
