After scrapping an attempt to get a similar offering away in December, Zurich-based EFG International AG sold 5.08 bln tenge ($27.3 mln) of three-month, callable notes on March 18, the first structured offering in the currency since September 2011, according to data compiled by Bloomberg. Leonteq AG, also based in the city, arranged the sale.

Expectations Kazakhstan will devalue the tenge are rising following the calling of a snap presidential election last month. The poll, scheduled for April 26, was to have been held next year.

Kazakhstan has been under pressure to devalue the tenge after a 46% plunge in the ruble last year boosted the competitiveness of Russian exporters. Russia is Kazakhstan’s biggest export market. Other former Soviet republics including Belarus, Azerbaijan, Turkmenistan and Moldova have devalued their currencies to adjust against the ruble’s decline.

The notes, sold by EFG International unit EFG International Finance Guernsey Ltd., were issued at 89.787% of par and have a final redemption value that’s tied to the exchange rate between the tenge and the U.S. dollar, Bloomberg-compiled data show.

Common Currency in EEU?

Russia’s Central Bank is to work together with the Russian government and the central banks of Eurasian Economic Union members on future areas of currency and financial integration within the union. In addition, specialists from the organizations must explore the feasibility of creating a currency union in the future, according to a copy of Putin’s instruction published on the Kremlin’s website.

However, according to analyst of JSC Asyl Invest Aivar Baikenov reported by Intefax, it is too early to talk about the creation of the currency union within the Eurasian Economic Union (EEU). For him, first of all it’s necessary to overcome the trade union’s difficulties and at the moment the creation of the currency union and launch of the common currency is a very complex objective and may not be profitable for all of the EEU member states. In case the tenge is replaced by the EEU common currency Kazakhstan’s economy may face a serious problem, according to Director of Macroeconomic Research Center Olzhas Khudaibergenov. Any currency union will not make sense until the joint financial regulator is set up, who may be available no earlier than in 2025, he told Interfax-Kazakhstan.

Aleksander Razuvayev, analyst at Alpari, considers that the recent ruble devaluation undermined trust in the Russian currency and the new currency might battle its negative consequences in many years to come.