Lebanon sells $2.2 billion of bonds

Chris Wright
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Biggest-ever bond sold in two tranches of 10 and 15 years, underpinned by robust banks.

These are uncertain times in global markets. So one might have expected a certain reticence from investors when a recently downgraded sovereign, which is unable to elect a president and has ISIS pushing at its borders, tried to launch its biggest-ever bond. In fact, it flew out the door.

On February 23, the Lebanese Republic launched $1.4 billion of 15-year bonds and $800 million of 10-year paper. It did so at 6.65% on the longer-dated tranche, 6.2% on the shorter. That’s no mean feat.

"If you look at Ghana as a comparable – it has the same credit rating and similar fiscal and structural weaknesses – well, Ghana doesn’t have to deal with ISIS or Hizbollah, yet it is trading at 9% to 10%," says Nicholas Samara, in emerging markets debt capital markets at Citi, one of the joint bookrunners alongside Blom Bank and Société...