* QNB to price $1 bln 5-yr bond on Tuesday - leads
* Launch price of 235 bps over midswaps
* First debt issuance from Qatari credit in 2012
(Adds analyst comment, background)
DUBAI, Feb 14 (Reuters) - Qatar National Bank
launched a $1-billion five-year bond at 235 basis
points over midswaps, with pricing expected later on Tuesday,
arranging banks said.
The launch price was tighter than initial guidance of 245
basis points over midswaps, issued earlier on Tuesday,
indicating strong appetite for the issue, the first from a
Qatari name this year.
Barclays Capital, Citigroup, HSBC,
Standard Chartered and QNB Capital are arranging the
issue.
Two market sources said order books were in excess of $3
billion for the deal.
"The bond hasn't left a lot on the table for investors -
It's a buy to hold story," said one regional fixed income
trader.
"The issue should be well-received overall because of the
strong credit quality, but I would be surprised if it pops too
much higher in the secondary."
QNB's existing $1.5 billion 3.125 percent bond maturing 2015
, was bid at just over 100 on Tuesday, to yield
3.053 percent according to Thomson Reuters data. It was trading
at a swap spread of just over 220 basis points.
The new bond will be the debut issuance under QNB's $7.5
billion programme, which it set up in August to fund its banking
operations.
The lender is 50-percent owned by sovereign wealth fund
Qatar Investment Authority and has been expanding abroad, with
operations in Syria, Jordan, the United Arab Emirates and
Switzerland.
It is currently in talks to acquire Turkey's Denizbank
. In January, Qatar's finance minister, who is also
chairman of QNB, said the bank could buy the Turkish lender by
year's end if the "price is right."
The business was expected to fetch up to $6 billion and would
be QNB's largest acquisition to date.
QNB also has a $1.85 billion five-year loan due for repayment
in July, according to Thomson Reuters data.
(Reporting by Rachna Uppal and Mala Pancholia; Editing by
Firouz Sedarat)
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