Yesterday, Bank CenterCredit (BCC) announced that it was not able to place T15bn 4-year bonds due to 'unsatisfactory prices'.
We believe these bonds were supposed to be purchased by ENPF, as the fund was planning to provide funding to commercial banks by placing deposits or/and purchasing their bonds. The auction was undersubscribed (0.05%) with three bids for a total amount of T6.7mn with yields ranging from 9.5% to 9.6%.
The unwillingness of the fund to participate in the auction is unclear to us, as only last week it has purchased T9.8bn 3-year bonds of BCC at 8.6%. We view the yield of 9.5% on BCC bonds (Fitch B) as being too high compared to the yields on Kazkom's 5-year bonds (8.4%) with the same rating.