VTB to launch overnight bond offering on Moscow Stock Exchange

18 october 2016

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On 17 October 2016, VTB Bank announced the launch of their overnight bond programme on the Moscow Stock Exchange.

The programme has been approved by VTB’s Supervisory Board and will float RUB 5 trillion of short-term exchange-traded bonds. It allows for a daily placement of securities on the Moscow Stock Exchange at pre-announced prices.

The bonds will be floated on business days between 16:00 and 16:45, after the interbank market closes, allowing investors who have not been successful in their bids for VTB bonds that day to place funds with the Bank of Russia overnight. The bonds will then be redeemable at noon on the next business day, allowing investors to use the funds for standard banking transactions. The benchmark for the overnight bond yield will fall between the Bank of Russia deposit rate and the interbank market levels.

These overnight bonds are a new and unique high-tech product on the stock market. They will allow overnight investment of unclaimed rouble balances and are targeted at a wide range of investors interested in reliable and short-term financial instruments/services.

VTB has announced this product as an extension of its range of tools for structuring liabilities, further reducing borrowing costs. The funds raised will be used in the normal course of bank activities.