Abanca offers to buy back Cédulas with juicy premium

Abanca offers to buy back Cédulas with juicy premium

Abanca HiRes 575

Spanish bank offers six year 23bp tighter than Caja Mar's five year

Abanca said on Thursday that it would buy up to €160m of its €750m 0.75% May 2029s which were issued in May 2019 and is looking to pay 27bp over mid swaps.

The offer price represents an 8bp premium to the indicative offer side, which was spotted at 35bp on Thursday. Abanca already owns €81.8m of these notes.

The announcement comes as Caja Mar Rural issued a €750m February 2028 at 50bp, suggesting the 27bp purchase price offers investors a tremendous opportunity to sell notes.

The affected bonds trade at 86% of par implying the prospective purchase also provides a good opportunity for the issuer.

The issuer said in a statement that the liability management exercise was designed “to provide liquidity” for noteholders, while “optimising its interest risk, funding and liquidity position.”

The expiration deadline has been set for 5pm CET February 17.

An announcement of indicative results is scheduled for February 20, with pricing expected to take place on the same day at 12CET, for settlement on February 22.

NatWest Markets has been appointed sole dealer and Kroll Issuer Services Limited has been appointed tender agent.

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