Investors divided over Pakistan's latest bond

The record $750 million 10-year issue performs disappointingly in the secondary market, leaving investors divided over the reasons behind the price drop.

The execution of PakistanÆs 10-year sovereign bond attracted diverging opinions from the buy-side last week.

The deal, managed by Citi, Deutsche Bank and HSBC, priced at par with a 6.875% coupon, equivalent to 200bp over US Treasuries, and 144.25bp over mid-swaps. Initial guidance was set at around 7%, and revised to 6.875%-7% on Thursday morning. The deal generated a $3.6 billion order book and was upsized from $500 million to $750 million, but was trading below par at a...

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