Mongolia

A recent succession of frontier market sovereign loans have given banks an opportunity to build relationships with these countries. Outwardly, some lenders may find it hard to stomach Mongolia, Pakistan and Sri Lanka risk. But a more nuanced view is needed. Getting in early will allow banks to be part of their development story.

The government of Mongolia is making its debut in the syndicated loan market, launching a $200m dual-trancher after plans for a bond fell through due to pricing issues. While the country’s heavy reliance on commodities makes it a risky bet, bankers reckon the development of a copper mine project and its potential income gives its outlook a boost. Shruti Chaturvedi reports.

The government of Mongolia is testing the market’s appetite for a $200m two tranche loan that has launched into syndication.

Mongolian Mining Corp (MMC) has hired two advisers as it seeks to restructure its outstanding bond. The plan comes as the country struggles with declining commodity prices and lower growth in China.

Only one lender is understood to have made a commitment to join China Shengmu Organic Milk’s $120m three year facility, which has been in syndication since December.

The Government of Mongolia has picked six banks to work on a 144A/Reg S bond that may hit the market as early as next week.

A $4.4bn loan agreement has finally been signed for the development of the Mongolian copper mine Oyu Tolgoi — a deal more than half a decade in the making.

Standard & Poor’s slashed the rating of Mongolia to B from B+ this week, citing the country’s poor economic growth prospects for the next few years. The cut was quickly followed by downgrades of the nation’s three major banks.

Trade & Development Bank of Mongolia (TDBM) is hoping to replicate the success it had earlier this year with a new 144A/Reg S offering.