Raiffeisen Bank Romania issues new EUR 500 million eurobonds
The Romanian branch of Austria’s Raiffeisen Bank placed its first ‘benchmark’ eurobond issue with a total nominal value of EUR 500 million, in what it said was a landmark transaction for the Central and Eastern Europe capital markets.
The bank’s eligible non-preferred senior eurobonds were subscribed at a fixed coupon of 4.136% p.a. for the first five years, respectively at a margin of 1.62% over the 5-year euro reference rate (mid-swap), approximately 0.35–0.38% below the yield of eurobonds with similar maturity issued by the Romanian state, according to the press release.
The issuance attracted significant interest from over 180 international and local institutional investors, primarily investment funds, insurers, and pension funds from the United Kingdom, France, and the DACH region (Germany, Switzerland, Austria).
The offering generated the third-largest order book, namely over EUR 2.8 billion final book and over EUR 3.3 billion maximum book, for an eligible MREL bond issuance of a CEE bank, as well as the most competitive funding margin obtained by a Romanian bank for an MREL eurobond issuance.
The bonds were rated Baa2 by Moody’s, above Romania’s sovereign rating (Baa3), and are set to be included in the bank’s eligible own funds and liabilities base, following approval from the National Bank of Romania.
The transaction was intermediated by Bank of America, ING Bank N.V., Natixis, and Raiffeisen Bank International as global coordinators, and Raiffeisen Bank as co-manager, with the bonds to be listed on the Luxembourg Stock Exchange.
“The success of the transaction represents a vote of confidence from investors regarding the anticipated trajectory and growth potential of the Romanian economy, in a global context marked by economic and geopolitical uncertainties. The issued bonds strengthen our eligible own funds and liabilities base, giving us the capacity to support the local economy with financing of approximately EUR 2.5 billion,” said Alina Rus, Vice President & CFO of Raiffeisen Bank Romania.
The transaction represents the ninth series of bonds issued by the bank since the launch of its EMTN bond issuance program, raising the total capital market financing to approximately EUR 1.6 billion.
(Photo source: press release)
