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Istanbul-listed Yapi Kredi sells $500mn of 5-year green eurobonds at 9.25% coupon

Yapi Kredi Bank (YKBNK), a unit of Turkish conglomerate Koc Holding (KCHOL), has sold $500mn of sustainable eurobonds (XS2445343689) due 2028 at a coupon rate of 9.25% (a spread of 486bp over US Treasuries) and a yield of 9.25%, the lender said on September 13.

Bank of America (New York/BAC), Citibank (Citigroup/New York/C), Emirates NBD Capital Limited, Industrial & Commercial Bank of China (ICBC/Shanghai/601398), ING Bank (Amsterdam/INGA) and Standard Chartered Bank (London/STAN), acted as intermediaries in the deal.

On September 12, Turkey’s government-run Vakifbank (VAKBN) sold $750mn of sustainable eurobonds (XS2677517497) due 2028 at a coupon rate of 9% (a spread of 464bp over US Treasuries) and a yield of 9.125%.

Turkey’s five-year credit default swaps (CDS) remain below the 400 level, while the yield on the Turkish government’s 10-year eurobonds remains below the 9% level.

In May, unnamed sources told Bloomberg that Turkey’s central bank asked some local lenders to buy the country’s dollar bonds to prevent a CDS spike.

Sentiment on the global markets, meanwhile, remains turbulence-free.

Separately, Yapi Kredi sold $26mn worth of 92-day bills on September 14, €22mn worth of 185-day bills on August 29 and GBP 27mn worth of 377-day bills on August 29.

In March, Yapi Kredi redeemed $500mn of paper (XS1788516679).

In June 2024, Yapi Kredi is to redeem $500mn of paper (XS1634372954), sold in 2017 at a coupon rate of 5.85%.


Yapi Kredi's outstanding eurobonds
Issuer ISIN Coupon Volume (mn) Issuance Maturity
Yapi Kredi Bank (YKBNK) XS1634372954 5.85% $500 Jun 2017 Jun 21, 2024
Yapi Kredi Bank (YKBNK) XS1958649854 8.25% $500 Mar 7, 2019 Oct 15, 2024
Yapi Kredi Bank (YKBNK) XS1957348441 FRN $322 Feb 25, 2019 Nov 25, 2027
Yapi Kredi Bank (YKBNK) XS2445343689 9.25% 500 Sep 13, 2023 Oct 16, 2028
Yapi Kredi Bank (YKBNK) (subordinated) XS2286436451 7.875% $500 Jan 15, 2021 Jan 22, 2031(/26)
Yapi Kredi Bank (YKBNK) XS1867595750 13.875% $650 Jan 15, 2019 Perpetual(Jan 15, 2024)


Table: Yapi Kredi's outstanding eurobonds.


As of August 2023, Yapi Kredi had $1bn worth of two outstanding eurobonds, $650mn worth of Tier I perpetual paper (callable in January) and $770mn worth of two subordinated (Tier IIeurobonds.

In 2021, Yapi Kredi sold $500mn of Tier 2 eurobonds due 2031, callable in 2026, with a 7.875% coupon.

In line with local peers, Yapi Kredi, the seventh largest bank in Turkey with Turkish lira (TRY) 1.4 trillion ($51bn) of total assets at end-June, has a B-/Negative (one notch below Turkey’s sovereign rating and six notches below investment grade) from Fitch Ratings and a B3/Stable (six notches below investment grade in line with Turkey’s sovereign rating) from Moody’s Investors Service.

On September 8, Fitch updated Turkey’s sovereign outlook to stable. Updates for corporate outlooks will be released soon.