Kazakhstan’s Ministry of Finance successfully concluded the placement of $2.5 billion in international bonds, marking a significant entry into the global debt markets, according to bne IntelliNews.
Completed on 24 June, this transaction stands as one of the nation’s largest debt offerings in recent years and establishes a new benchmark for cost-effective borrowing among emerging market issuers with comparable credit ratings.
The dual-tranche structure comprised $1.35 billion in seven-year notes carrying a coupon of 5%, alongside $1.15 billion in 12-year bonds priced at 5.5%. Demonstrating robust international interest, the ministry reported that the offering was oversubscribed by a factor of two.
This enthusiastic reception reflected “strong confidence from global investors” spanning key financial centres in Europe, North America, Asia, and the Middle East.
The funds raised are designated for the refinancing of Kazakhstan’s outstanding eurobond obligations falling due in 2025. This successful issuance follows a targeted roadshow in London that engaged approximately 180 institutional investors.
According to the Finance Ministry, the achieved yields were notably lower than those typical for peers rated BBB, while also proving competitive when measured against A-rated sovereigns such as Poland, Saudi Arabia, and Chile.
Despite challenging market conditions, we achieved competitive pricing comparable to higher-rated A/AA sovereigns.
Furthermore, the offering set a 2024 record for the lowest coupon levels among sovereign issuers rated within the A/BBB categories.
The Astana International Exchange (AIX) confirmed details on Tuesday, noting that initial pricing guidance targeted yields of approximately 5.25% for the seven-year tranche and 5.625% for the 12-year tranche. Minimum tranche sizes were set at $500 million each.
The newly issued eurobonds will be listed on the London Stock Exchange (LSE), the AIX, and the Kazakhstan Stock Exchange (KASE). Kazakhstan’s ability to secure such favourable terms occurs against the backdrop of a government forecast predicting a 2025 budget deficit of 2.7% of GDP.
It underscores a broader governmental effort to diversify financing sources and uphold fiscal stability.
