Kazakhstan's Bank TuranAlem (BTA) is understood to be coming shortly with a multitranche deal backed by diversified payment rights (DPRs), according to market sources. The word is that the sole lead is Standard Chartered. This would mark the bank's public debut in that asset class.
Some or all of the tranches are expected to be wrapped, and one source said that the Asian Development Bank (ADB) might end up providing one of the sureties. The ADB has provided guarantees for a $100 million tranche in a closed DPR deal from Kazakhstan's Alliance Bank and for a $100 million piece in a DPR transaction from Kazkommertsbank (KKB) now being marketed.
BTA unit BT-Ipoteka issued an RMBS via ABN AMRO last month, the first transaction in that asset class from a Kazakh originator (ASR, 3/26/07). Apart from the KKB deal that is slated to price this week, Kazakhstan hasn't yielded any DPR transactions so far this year. Sources expect Kazakhstan to be one of the most prolific in emerging market securitization issuance for 2007. Last year, Kazakh banks placed $500 million in DPR deals, with KKB, Alliance, and ATF Bank among the originators. There were no existing asset deals from the country in 2006.
The growth of DPRs among Kazakh banks is underpinned by the torrid pace of economic expansion on the back of energy exports and investments. From 2005 through 2008, exports and FDI are expected to account for 40%-50% and 5%-8% of gross domestic product, respectively, according to a report by Standard & Poor's. Worker remittances, which play a pivotal role in DPRs in some Latin American countries, have a negligible impact on DPRs processed from Kazakh banks.
BTA was established in the merger of Turan Bank and Alem Bank in 1997. By any criteria, it is now ranked one of the three largest banks in Kazakhstan. Fitch Ratings, Moody's Investors Service and S&P rate BTA BB+'/Ba1'/BB', respectively.
Meanwhile, Russia's DeltaCredit priced a multi-tranche mortgage deal, a first for the bank. The deal was also an introduction to Russian RMBS for sole lead Societe Generale, which is DeltaCredit's parent.
A $173 million, 3.1-year average-life tranche priced at 105 basis points over one-month Libor, according to data on Bloomberg. Fitch and Moody's rated that piece A' and A2', respectively. A $14.5 million, 5.3-year average-life tranche priced at 145 basis points over one-month Libor. Ratings on that slice were BBB+' and Baa2', respectively. Finally, a $18.6 million, 5.3-year average-life tranche priced at 335 basis points over one-month Libor. That piece garnered ratings of BB+' and Ba2.' The settlement date is April 12.
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