Economics
Sanctions-Free No Shield for Alfa in Wary Market: Russia Credit
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OAO Alfa Bank risks paying the highest borrowing costs in at least seven years as the Russian lender unblemished by the toughest sanctions since the Cold War seeks to lure Eurobond investors wary of the nation’s debt.
No Russian issuer has braved the dollar or euro debt market for a major sale since the U.S. and European Union in July blocked lenders including OAO Sberbank and VTB Bank from accessing funds. Investors will demand that Alfa Bank pay a premium of 30 to 35 basis points above its existing curve, the most since at least 2007, to compensate for the risk that the Ukraine crisis will worsen, Jefferies International Ltd. said.