Dutch entrepreneurial development bank FMO, in partnership with TCX, has set a new milestone in frontier currency markets: its largest offshore note ever issued in a frontier currency, amounting to USD 50 million in Uzbekistani som.

TCX has seen and still expects significant inflows of UZS risk, on the back of large investments in the financial sector in Uzbekistan. The issue was arranged by Citi and will be listed in Luxembourg. Please read more in this press release (PDF) or go to FMO’s website.

By structuring notes together with its shareholders such as FMO, EBRD and IFC, investors get access to UZS risk and return in combination with the AAA credit risk of the issuer. By selling this FX risk, TCX itself can support more investments in Uzbekistan in local currency, whilst it creates a market for frontier-currency risk.