USD 600 million Euro Medium Term Note Program

Press Release

Development Bank of Mongolia has successfully issued its bonds and on good terms

The Development Bank of Mongolia has opened a new page of history in Mongolia’s banking and financial sector with its US$ 600 million Euro Medium Term Note Program, in coordination with its internationally recognized partners in ING, Deutsche Bank and HSBC.

International rating agencies, Moody’s and Standard&Poor’s have rated the Development Bank of Mongolia’s bonds similarly to the Government of Mongolia, Moody’s - (B1),  S&P - (BB-).

The Development Bank of Mongolia’s bonds are the first sovereign bonds issued with the guarantee of the Government of Mongolia. Although the world capital market situation is not favorable at present, the Development Bank of Mongolia managed to issue the bonds in the best terms and at a low interest compared with countries in a similar situation.

The five-party agreement to establish this program will be signed by S. Bayartogt, Finance Minister on behalf of the Government of Mongolia as the Guarantor and Kim, Jang Jin, CEO of the Development Bank of Mongolia. At this moment the representatives of the investment banks are also signing the agreement in their respective countries.

DBM aims to provide financing for large scale projects in priority and strategically important sectors to support economic growth and the production of value-added goods. It shall provide the funds to the following priority sector projects and programs, approved by the Parliament:

·         New Development medium term target program;

·         State policy on Railway transport program;

·         Sainshand Industrial Park; and

·         Projects and Programs included in the List of auto roads and energy facilities to be built using DBM’s own funds with a condition of to be paid later.

The EMTN Program established by the Development Bank of Mongolia provides an opportunity to start financing these strategically important projects and programs and within this program the bonds worth US$ 600 billion are planned to be sold in several stages through the Singapore Stock Exchange this December and into 2012.

We are pleased to inform you that the initial takedown of US$ 20 million will be transacted shortly. The program which we have established today represents the foundation upon which DBM will expedite the construction work that is so eagerly anticipated and through which DBM will make its valuable contribution to Mongolia’s successful development.

            We are cooperating with ING, Deutsche bank and HSBC, all of which are internationally reputable and experienced investment banks, to implement the Euro Medium Term Note Program.

            Global investment bank ING, headquartered in the Netherlands, has been carrying out investment activities in Mongolia for the last three years. It cooperates with domestic banks, such as Khan bank and Trade and Development Bank and has profound experience and knowledge about the economy and business sector of Mongolia.

            Deutsche bank, a global investment bank with a history of 141 years, provides its services in over 70 countries worldwide. In the third quarter of 2011 it was named the top bank in the Euro bond markets according to Bloomberg reports.

            HSBC, with its history of 146 years, is considered a reputable and leading bank in international stock markets. It is headquartered in London and operates in 87 countries around the world. According to Bloomberg reports it is ranked closely behind Deutsche bank in the Euro bond markets.

DEVELOPMENT BANK OF MONGOLIA