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Concorde Capital Research: PUMB’14 note holders approve restructuring

December 05, 2014 | Cbonds

The holders of the Eurobonds of First Ukrainian International Bank (PUMB, PUMBUZ), maturing on December 2014, voted on Dec. 4 in favor of restructuring terms earlier proposed by the bank. The holders of 89.7% of the notes participated in the vote (amid a 2/3 quorum) and 92.2% of them voted in favor of restructuring (amid a 75% quorum), the bank reported on a special website on Dec. 4.

As a result of the restructuring, the bondholders who offered their consent by the Dec. 1 deadline (82% of total holders, we estimate) will exchange USD 215.5 per each USD 1,000 in face value of their PUMB notes into the same amount of cash on Dec. 31. Other bondholders will get no upfront cash. The terms of all the remaining notes, whose amount outstanding will decrease USD 45 mln to USD 207.56 mln, will be as offered earlier: the ultimate maturity will be prolonged to Dec. 31, 2018 and the quarterly coupon rate will remain at 11%. The bond will amortize by a total amount of USD 10 mln (or about 4.8%) on Dec. 31, 2015 and the remainder will amortize in ten equal quarterly installments (of about 9.5% each) between Sept. 30, 2016 and Dec. 31, 2018. PUMB expects the new conditions will be effective as of Dec. 11, 2014.

Alexander Paraschiy: PUMB explained its need to extend its Eurobond payment by its wish to reserve dollar cash for the smooth repayment of its dollar deposits next year. Thus far, it seems like PUMB, which remains one of the healthiest banks in Ukraine, will service easily its Eurobond with its extended repayment schedule. Therefore, we believe the bank’s amended notes should trade with a smaller spread to the sovereign curve as compared to the bonds of other banks or other issuers of the SCM business group with comparable maturity.

Company: FUIB

Full company namePublic joint-stock company "First Ukrainian International Bank"
Country of riskUkraine
IndustryBanks

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