Bank of Moscow is selling its first bonds denominated in Singapore dollars and has hired ING Groep NV and UBS AG to arrange the two-year notes sale.

The Moscow-based bank declined to provide other details, according to a statement e-mailed by its press department today.

 

“This is rather exotic,” Nikolay Podguzov, the head of bond strategy in Moscow at VTB Capital, said by e-mail. “I don’t think this will be a trend.”

 

Bank of Moscow’s shares surged the most in six years today, gaining 21%, after Alfa Bank, Russia’s biggest private lender, said it’s interested in competing for the stake that’s owned by the Moscow city administration.

 

Moscow’s government is planning to sell shares in 200 of its 433 companies this year, including Bank of Moscow. State- controlled VTB Group, Russia’s second-biggest lender, is interested in purchasing the 46.5% stake in the bank, Finance Minister Alexei Kudrin said in November.

 

VTB sold 400 million Singapore dollars of two-year notes yielding 4.2% in July. The bonds yielded 3.56% today, pricing on Bloomberg shows.

 

Bank of Moscow declined to comment on Alfa Bank’s statement today. Bank of Moscow bonds gained, reducing the yield on its US$500 million ($641.7 million) of notes due in 2013 to 4.44% from 4.50% at 1 p.m. in Moscow today.