Bank of Baroda cancels dollar bond issue

State owned Bank of Baroda cancelled its planned benchmark sale of bonds denominated in US dollars, according to three people familiar with the matter.

The people didn’t say whether the sale will be rescheduled or provide further details. The bank had planned to sell five-year notes priced to yield about 250 basis points over the benchmark mid-swap rate, two people familiar with the deal said yesterday, declining to be identified before a public announcement. A benchmark sale is typically $500 million in size.

“We’re in a temporary period where markets are gripped with risk aversion and if you need to come to market now, you’re going to have to pay up,” Tim Condon, chief Asia economist at ING Group NV in Singapore, said in a telephone interview today. “If you can afford to wait, it’s in your best interests to. I think that must be the advice most debt capital market players are giving their clients at this point.”