Bahrain pvt bonds raise $500 million

london — Bahrain raised $500 million from a private placement of bonds with five regional banks, giving the island-kingdom much-needed relief as it negotiates crucial financial support with its Gulf Arab allies.

The bonds were placed with Bank ABC, Emirates NBD PJSC, Kuwait Finance House KSCP, Noor Bank PJSC and Sharjah Islamic Bank, according to people with knowledge of the matter who asked not to be identified because the details are private.

A sell-off in emerging-market assets is prompting some countries to avoid the scrutiny of international bond investors, with cash-strapped Ukraine raising $725 million in Eurobonds from a private placement last month.

For Bahrain, the latest funds also give officials time to agree on the details of the aid package with Saudi Arabia, the UAE and Kuwait.

Bahrain’s economy, the smallest in the Gulf Cooperation Council, has been hit hard by the slump in oil prices in 2014. With rising public debt and low foreign-exchange reserves, investors say the kingdom needs support to avert a currency devaluation that could reverberate across the region.

The talks are making progress on a multi-year program that would involve spending cuts and measures to increase non-oil revenue, people with knowledge of the matter said last month.

“They haven’t released any details on the GCC rescue package, so they wouldn’t have been able to issue publicly,” said Anthony Simond, who helps manage $13 billion of emerging-market debt at London-based Aberdeen Asset Management Plc. Bahraini officials weren’t immediately available for comment on the private placement. Authorities have repeatedly said they have enough reserves to maintain the currency’s peg to the dollar.