Nomos ruble bonds offer good premium, says VTB

In research published today, VTB Capital says that it views a reported new offering by Nomos Bank of seven-year ruble bonds worth RUB 5 billion ($170 million) favourably. The price talk is for a coupon of 8.75-9% to the three year put (YTP 8.94-9.20%). This corresponds to a spread to swaps of 380-410bp. Compared with this, the bonds which the bank has already placed trade with a spread to swaps of 260-280bp.

Strategists point out, also, that the book for TransCreditBank’s (??1/BB) three-year issue is open, with price talk of an 8-8.4% coupon. Nomos offers a premium to TCB of 60-75bp which looks justified: that is roughly the same spread at which the short (but similar in duration) Nomos-9 (YTP 6.64%) and TCB-3 (YTM 5.94%) bonds are trading.