As the pioneer of Asset Backed Securities (ABS) issuances in Türkiye, PASHA Bank is breaking new ground once again. PASHA Bank and OMG Capital Advisors offer an investment opportunity with a “wheat indexed” return for the first time in Türkiye, with a 72-day maturity ABS issuance. Wheat, which has become the most important commodity of the last period, is turning into a new investment tool.
Contributing to the development of trade between Türkiye-Azerbaijan-Georgia and operating in Türkiye for 8 years, PASHA Bank continues to stand by its customers with its ABS issuances. By signing another first in Türkiye, PASHA Bank, which plays a leading role among investment banks in the issuance of ABS, which is important for the development of the real sector and the increase in employment, transforms the value of wheat into investment and offers investors the opportunity to invest with wheat indexed returns. The issuance with a 72-day maturity and a prototype value of TRY 3 million, which has made an important innovation in the financial markets, has a TR A2 rating by TURK rating. The clearing date of the issuance, whose book-building date ends today, is Friday, June 23, 2023.
Wheat, which has become one of the most valuable commodities due to issues such as the pandemic, climate crisis, access to food, and the Ukraine-Russia war, turns into an investment tool with the issuance of ABS indexed to the wheat price. Based on the fact that the collateral pool of ABSs is made up of farmer's bills and farmer's income is dependent on agricultural commodity prices, the first ABS issuance based on wheat price is realized.
From the farmers' point of view, indexing the futures price of purchased agricultural inputs to the wheat price eliminates the pricing risk by eliminating the uncertainties in the financial markets. For the investor, a new instrument has emerged that has low correlation with other assets in the portfolio and provides direct access to commodity price changes.
PASHA Bank General Manager H. Cenk Eynehan stated the following regarding the subject:, “As a leading bank in abs issuances, we continue to support the sustainability of today, the future and the economy with issuances. As you know, we have been supporting the real sector and especially the agricultural sector with ABS issuances since 2020. This time, we broke new ground in Türkiye and turned wheat into an investment tool. We are proud of developing a new product in Turkish capital markets and realizing the first "wheat price indexed" ABS issuance. With this product, the most valuable commodity for both our country and the whole world will be a new financial instrument for our investors.”
These issuances to the agricultural sector not only enabled Tarfin to support more farmers, but also showed once again the critical role played by innovative capital market instruments such as ABS in the financing of the real sector. Tarfin Tarım A.Ş. offers fertilizer, seeds, feed and similar agricultural inputs to farmers in 80 provinces and 13,024 villages from 1,196 sales points at competitive prices and maturity opportunities suitable for farmers' cash flows.