Ten top global banks vie for Pakistan’s $1 billion eurobonds

ISLAMABAD: Ten leading global lenders have expressed interest in Pakistani eurobonds as the government plans to raise about $1 billion within the next two months to shore up foreign exchange reserves, a top finance ministry official said on Wednesday.
A eurobond, or external bond, is a fixed-income debt instrument denominated in a currency not native to the country where it is issued. About $1.5 billion worth of eurobonds were part of Pakistan’s financing plan in the past fiscal year but were delayed due to adverse market conditions.
The new bonds are expected to be issued in December or January, Kamran Afzal, the ministry’s special secretary, told reporters on Wednesday.
“10 leading banks have submitted their financial and technical bids to structure the bond issue,” Afzal was quoted by local media as saying.
Bank of America, Bank of China, and several other lenders from Europe and the Gulf region are reportedly among the lenders interested.
“Their bids will be evaluated next week and it is expected that two consortiums will be hired to put in place structures for floating the Eurobond and the Sukuk bond,” the Express Tribune newspaper said.
Afzal said the government would first float the Eurobond and then the Islamic bond also, depending on the advice of financial advisers. This will be the first capital market transaction by the government of Prime Minister Imran Khan and will help Pakistan meet its external debt obligations such as the repayment of major loans, including $3 billion to Saudi Arabia.
The Group of 20 nations (G20), representing the world’s biggest economies, last month suspended debt payments of Pakistan and dozens of other developing countries to help support their fight against the coronavirus pandemic. G20 has agreed to extend debt suspension for these countries until June 2021.

Ten top global banks vie for Pakistan’s $1 billion eurobonds