BBK conducts a roadshow and closes a successful bond issuance raising $400 million

31 Mar 2015

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BBK, Bahrain’s pioneer in retail and commercial banking, closed a bond issuance of USD 400 million last week through the issuance of an international senior unsecured bond with a five year maturity date.

The issuance targeted professional investors in the Middle East, Far East and Europe and followed a successful five day roadshow conducted in Singapore, Hong Kong, Abu Dhabi, Dubai and London. The investor mix was diversified whereby 70% of the investors were based in the Middle East, 8% based in Asia and 22% in Europe. Furthermore, 50% of the bonds were bought by banks and the remainder by fund managers, private banking clients and pension/insurance companies.

A delegation consisting of Mr. Riyadh Sater, Deputy Chief Executive, Dr. A.Rahman Saif GM of Treasury, Investment & Institutional Banking, Mr. Mohammed Abdulla Chief Financial Officer, Mr. Neil Sharp Head of Treasury, Mr. Amit Kumar Chief Risk Officer and was led by Mr Abdulkarim Bucheery, the Chief Executive of BBK, met with around 45 international investors to update them on BBK’s strategy and sound financial performance. A total of 57 regional and international investors invested in BBK bonds, with a fixed coupon of 3.5% and a re-offer price of 99.09%, and rated BBB by Fitch Ratings and Baa2 by Moody’s. The bond was substantially oversubscribed with the order book reaching around USD 900 million. The success of the issue shows the confidence that investors have in the prudent, conservative management and financial position of such a long established domestic bank.

Mr. A.Karim Bucheery, upon the delegation’s return from the roadshow said:” I am very pleased to see BBK able to tap the international capital markets again which shows the strength of the Bank and the confidence of the investors despite the slump in oil prices and its volatility and the political tensions in the Middle East; such circumstances makes it challenging to raise capital. Nonetheless BBK’s impeccable reputation regionally and internationally has supported the success of this bond issuance; the bond was substantially oversubscribed with the order book reaching around to $ 900 million which I am very content about. This was backed by our strong results which reaffirm the success of the bank’s focus on implementing the key initiatives for growth outlined in its strategic plans. Our financial results tell their own story, as we announced a new record profit of BD 50.1 million for the year ended December 2014, 11.2% higher than the same period of last year of BD 45.1 million; with earnings of 50 fils per share”

The proceeds of the bond will be used to repay BBK’s existing $500 million bond which matures in October 2015 and will further enhance BBK’s stable funding base. This puts the Bank on a very comfortable liquidity position and gives it the ability to tap the markets again when needed.
BBK is one of the leading Banks in Bahrain; it strives to always be in a position to leverage its experience, history and reputation for the benefit of its clients, shareholders and the Kingdom of Bahrain. The Bank has exceeded the minimum regulatory requirements of capital adequacy and Basel III requirements. It has also been designated by the Central Bank of Bahrain as a Domestic Systemically Important Bank (D-SIB) which strengthens the market’s perception of BBK as a premier financial institution and its importance to the Bahraini economy and financial sector.  BBK has also been pursuing expansion and after the inauguration of the fourth branch in India the Bank is now the only Arab Bank with presence in the Indian capital New Delhi. Further expansion plans in the region and internationally are in the pipeline.
Aside from many industry related awards, BBK is ISO 27001 & ISO 22301 certified for its Information Security Management System (ISMS) and Business Continuity Management System (BCMS).

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