MEIKAM-36 of the Ministry of Finance of Kazakhstan issue #2 - complete offering results

/IRBIS, Feb 27, 01/ - Today the Ministry of Finance and the National Bank of Kazakhstan held 2nd auction for MEIKAM-24 floatation (1092 days). Announced issue volume is set by the issuer at KZT300 mln. Size of satisfaction of noncompetitive applications is 50% of specified amount. Following is the complete offering data. As the first issue of MEIKAM-36 (Nov.30, 2000) was canceled following no comparisons have been given. Type of the securities МЕIКАМ-36 NSIN KZ3CL2702A49 KASE trade code MIM036.002 IRBIS registration number 2i/36 Par value, KZT 1,000.00 Issuance date Feb.27, 01 Payment day (till 11:00AM Almaty time) Feb.28 1, 01 Circulation start date March 1, 01 Maturity date Feb.27, 04 Days in circulation 1092 Planned volume, mln KZT 300.0 Number of primary dealers 11 Demand, mln KZT 1,676.5 Max. fixed yield on demand, % APR 25.00 Actual volume, mln KZT 310.0 Fixed yield, % APR 7.60 Coupon payment on bonds will be paid on June 07, 01; Sep.07, 01; Dec.07, 01, March 07, 02, June 07, 02; Sep.07, 02; Dec.06, 02; March 07, 03; June 06, 03; Sep.05, 03; Dec.05, 03; March 05, 04. According to the Ministry of Finance non-residents did not submit any applications for the auction. The investors looked surprisingly active today. MEIKAM has never been a favorable instrument on the market despite more profitable yield to maturity compared to other synchronous bonds. High inflationary expectations are justified in conditions of excessive liquidity problem. Investors probably took this aspect as reason for their actions. Deficit of instruments on the market and increasing participation of pension assets has some impact on the situation as well. Strict position of the issuer regarding debt restructuring policy forces participants to accept rules of the game. It is most probably that main investors for MEIKAM are pension assets management companies, entities that are obliged to invest pension assets in proper terms. However, some participation of one or two major banks could be assumed as well. Experience shows that banks could be aggressive in all sectors of the financial market. This tactics sometimes finds support from NBK. In addition, liquidity constraint is a day's agenda only for small and middle financial institutions.