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Business / Finance

Alfa-Bank to prepay $250 million subordinated loan

News of Alfa-Bank 10.01.2020 at 08:19

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Alfa-Bank adopted a decision on early repayment of a subordinated loan with a volume of $250 million raised in 2014 at a rate of 9.5% per annum. In October-November 2019 in two successful new issues of subordinated Eurobonds the Bank has attracted $400 million and $450 million at more attractive rate of 5.95% per annum.

the Inclusion of an additional loan in the capital of alpha Bank have raised N1.0 to 12.78% (on 18.12.2019), which significantly exceeds the required 01.01.2020 with the minimum level of 11.50%, taking into account all allowances. Thus, a comfortable reserve of capital adequacy enables the Bank to repay a more expensive loan of 2014, and simultaneously to implement strategic plans to increase loan portfolio.

"As a quality Issuer, Alfa Bank has extracted the maximum benefit from favorable market conditions in the debt market by the end of 2019. Thanks to the active interest of investors from USA, Europe, UK and Switzerland, we have attracted new subordinated loan with a comfortable margin — a total of $850 million at 5,95%. Given the significant difference in the rate of early repayment of the 2014 release will reduce the cost of capital", — said the chief financial officer, Deputy Chairman of the management Board of Alfa-Bank Alexey Chuhlov.

In December 2019 Alfa-Bank has received the relevant approval of the Bank of Russia. Technically early repayment, provided documentation after 5 years and 3 months from the date of raising funds, held 18 Feb 2020 simultaneously with the payment of accrued interest.

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