Emirates NBD, ABN Amro Bank, Deutsche Bank and Raiffeisen Zentralbank Osterrreich (RZB), have jointly arranged a $220 million, 18-month syndicated term loan facility for Bank of Moscow, the fourth-largest bank in Russia, the representatives of the arrangers and the borrower announced on Tuesday, GN reported.
The facility, which was launched at $100 million, was increased to $220 million following over-subscription from various international banks.
A total of 18 international banks participated in the facility. Thirty per cent of the bank lenders were from the Middle East, 64 per cent from Europe and about six per cent from Asia.
Of the total loan, Emirates NBD, ABN Amro Bank, Deutsche Bank and Raiffeisen Zentralbank Osterrreich (RZB) have raised $25 million each.
The loan pays a margin of 65 basis points per cent per annum over London Interbank Offered rate (Libor).
"Given the tenor (of 18 months), the pricing was adequate in the current market, which has yet to yet to recover from the global credit crisis," said Pavel I. Gorbatsevich, executive vice-president and deputy chairman of the board, Bank of Moscow.
The bank established the new facility for its trade finance and general corporate funding requirements.
For Emirates NBD, it was not just the confidence in the borrower, but as Abdul Wahid Al Fahim, general manager, Wholesale banking, Emirates NBD, said, it was the "strength of the Russian economy," that influenced its decision to be a participant in this transaction.
"Russian banking institutions and communities are hungry for funding, with the Middle East being a liquid area driven by the petro dollar," said Zaid Maleh, vice-president at RZB.
As part of its diversification strategy, Emirates NBD is also exploring different geographies. "We are a leading bank in origination in Russia, CIS, Kazakhstan," Al Fahim said. Currently the Gulf's largest bank by assets, Emirates NBD has ties with 14 Russian banks.
As reported by Gulf News last week, Emirates NBD topped the table for syndicated corporate loans in the UAE for the first four months of 2008, executing nine deals with a total value of $14.7 billion.