Late last year the fledging market for syndicated loans to Russian banks witnessed its most ambitious and successful deal to date. Tokobank, in its first syndication, raised $85 million at a spread of 4H% over Libor. This was the first loan for a Russian bank at a spread below 5% and more than twice the size of any other such deal.
The market for Russian bank debt has developed rapidly since the first deal, a $20 million extendible revolving credit for Mosbusinessbank arranged by Union Bank of Switzerland in mid-1995. That loan paid 5H% over Libor and was provided by six lenders. Spreads have fallen steadily since then and the latest deal, a $25 million credit for Bank Imperial launched last December, pays only 3M%.
Tenors have lengthened over the same period. The Tokobank deal has a one-year maturity and bankers believe that some of the top credits could raise funds over two years.
Bankers stress that this is a market for brave lenders. Most Russian banks will not divulge detailed information and it is hard to understand the few figures that are released. "We are working in a very difficult environment.