Irish Life & Permanent, the Dublin-based life assurer and mortgage lender, has converted a GBP500 million (USD937 million) bond issue to a synthetic euro-denominated liability via the currency swap market. The bond pays a floating-rate coupon of three-month LIBOR plus 7.5 basis points, and matures in 2009.
Barclays Capital and BNP Paribas were the bookrunners on the bond issue and UBS and The Royal Bank of Scotland are the swap counterparties. Niall Bolles, chief dealer at Irish Life, said, "We look for competitive pricing in counterparties, even above credit rating." UBS and RBS are often counterparties on Irish Life currency swaps because they offer competitive pricing, explained Bolles. He declined to reveal the foreign exchange rate in the swap but said the final all-in cost was EurIBOR plus 1.3 basis points. Euro/sterling spot closed at GBP0.672 last Tuesday.
