By Michelle Meineke
LONDON, Oct 4 (Reuters) - Russia's largest bank Sberbank
has mandated 10 relationship banks for a $1.5 billion loan and has launched the deal to around 100 banks in general syndication, two bankers close to the deal said.
Barclays is coordinating Sberbank's three-year loan, which is the largest such deal in the central and eastern European (CEE) pipeline, the bankers added.
Syndication is scheduled to close by the end of October, bankers said.
Sberbank was not immediately available to comment.
Sberbank last tapped the international loan market for a $1.2 billion, three-year loan in November last year and the majority of the 10 mandated banks were part of the original lending group.
Bank of Tokyo-Mitsubishi UFJ, Barclays, Citi, HSBC, ING, JP Morgan, WestLB, Goldman Sachs, Bank of America Merrill Lynch and SMBC participated in the 2011 deal.
The loan pays 190 basis points (bps), which marks a 60 bps price hike on Sberbank's last deal. Some bankers said pricing for the new deal looked "overly aggressive" when considering the negative impact of the eurozone debt crisis on banks' lending capacity, especially for European banks who are short on US dollars.
Consequently, there could be a limited response in general syndication, one European banker said.
The majority of interest is expected to come from Chinese and Asian banks, the two bankers said.
"Chinese banks will get involved in this deal - it's a no brainer for them to get it approved internally," a second European banker said. "The pricing pays more than the levels that some of them may be able to get on the local Asian markets."
The deal will help boost the record-low syndicated loan volumes across CEE this year.
Demand for loans from international banks has been curtailed by pockets of strong liquidity in countries such as Russia and Turkey, which means that many local borrowers are able to satisfy their borrowing demands closer to home.
In addition, the bearish impact of the eurozone debt crisis means that many CEE borrowers' demand have fallen, as they are forced to curb their development plans.
CEE dealflow has fallen 51 percent to $36.4 billion in 2012, from $75 billion during the same period in 2011, according to Thomson Reuters LPC data.
In Russia alone, volumes in the first nine months of the year plunged 60 percent to $15 billion, compared with $37.7 in 2011.
(Reporting by Michelle Meineke; Editing by David Holmes)
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Keywords: SBERBANK LOAN/MANDATE