BAKU, Azerbaijan, January 27. Baku Stock Exchange (BSE) has completed a trade of manat-denominated bonds issued by the European Bank for Reconstruction and Development (EBRD) on the secondary market, totaling 3 million manat ($1.76 million), BSE Management Board Chairman Ruslan Khalilov told Trend.
In an interview with the agency, Khalilov also highlighted the launch of trading in EBRD’s manat-denominated floating-rate bonds on the BSE, calling it a highly significant development.
“This is the first issuance by an international financial institution in both local currency and floating-rate note format. There has even been a transaction on the secondary market, with an operation amounting to around 3 million manat ($1.76 million).
Another benefit of trading EBRD’s floating-rate manat bonds is that, although it may be early, this could eventually lead to interest rate swap transactions. At the very least, the market now has a floating-rate bond as a first step, which did not exist before. This was a very important step,” he explained.
According to Khalilov, negotiations are currently underway with several other international financial institutions regarding bond issuances.
“International development banks are interested in issuing in local currency, as this allows for more effective management of 'currency risk.' Many international financial organizations with which we are in contact are interested in issuing bonds on the Baku Stock Exchange.
We see such practices in neighboring countries. However, it would not be correct to say which institution will issue and when. I would say that almost all international development banks operating in Azerbaijan are interested in issuance. At the very least, because as development banks, the most suitable solution for them is to issue bonds in local currency at their own risk levels and then channel the proceeds into local strategic projects, also in local currency,” Khalilov said.
He noted that the exchange actively engages with these institutions, invites them to meetings, and provides information about the domestic market.
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