Kazakhstan Issues $2.5 Billion in Eurobonds Amid Strong Investor Demand

The Ministry of Finance of Kazakhstan has issued sovereign Eurobonds totaling $2.5 billion, with investor demand exceeding supply by a factor of two, Orda.kz reports.

According to the Ministry, the issuance includes two tranches:

• $1.35 billion in seven-year bonds with a 5% coupon rate
  
• $1.15 billion in 12-year bonds with a 5.5% coupon rate

Ahead of the placement, the Finance Ministry held meetings with potential investors in London. Interest was expressed by around 180 companies, supported by Kazakhstan’s macroeconomic indicators, low public debt, and strong external reserves.

The Ministry of Finance has achieved competitive placement conditions. Yield levels have been in a range comparable to the conditions under which countries with higher credit ratings (A/AA) such as Poland, Saudi Arabia and Chile are placed, and significantly lower than those of countries with a BBB rating (Mexico, Hungary, Peru). In addition, Kazakhstan has set a record by placing bonds at one of the lowest rates among countries with an A/BBB rating this year,
the Ministry stated.

The Eurobonds will be listed on the London Stock Exchange, the AIFC Exchange, and KASE. Proceeds from the new issuance were also used to refinance earlier Eurobonds coming due.

Previously, it was reported that Kazakhstan ranked last in Central Asia for foreign direct investment in 2024, largely due to the completion of large-scale oil and gas projects.

Original Author: Nikita Drobny