Bermuda-based political risk writer Sovereign Risk Insurance Ltd. last night announced it had issued Turkey?s fifth largest privately owned bank ? Finans Bank ? a political risk policy designed to help it raise capital in international capital markets.

In a Press statement, Sovereign said ?the policy supports a landmark transaction involving the issuance of US$200 million of ten-year subordinated callable notes, by Finans Capital Finance Limited (FCFL) pursuant to (private placement) rule 144A/Regulation S?.

The proceeds of the notes will reportedly be used by FCFL to make a loan to Finans Bank, which in turn will use the funds for general corporate purposes.

The head of Finans Bank?s international division, Ozlem Cinemre, said the political risk policy from Sovereign had enabled Finans to get a superior debt rating, as well as to achieve some firsts for Turkey.

?The issue was very well received, and the insurance coverage provided by Sovereign helped Moody?s to rate the notes Ba1, considerably higher than the rating for Turkish government debt.?

He added: ?We are very pleased with the outcome. Finans Bank is proud to be the first Turkish issuer of ten-year obligations, and the first bank to

issue subordinated debt in the international capital markets.? The transaction is also the first political risk-supported bank deal for Turkey.

Sovereign said the ten-year political risk insurance policy covers up to 18 months of interest payments on the notes against the risks of currency inconvertibility and non-transfer.

Merrill Lynch & Co. acted as sole placement agent for the notes.

Sovereign, a joint venture of XL Capital and ACE Limited, has the ability to issue political risk insurance policies for amounts up to $125 million and for periods up to 15 years.