Investors lap up RBI AT1 despite extension risk

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By Jasper Cox
17 Jan 2018

Raiffeisen Bank International’s additional tier one (AT1) bond — the first in the asset class this year — met a wall of demand and was priced with a coupon that was tighter than all but one euro AT1. This was in the face of investors’ preference for bonds offering a higher reset spread, increasing the chance of bonds being called.

Cartoon_1538_RaIFFEISENInitial price thoughts were in the 5% area. This was tightened to 4.5%, making it the second tightest AT1 in euros ever, after Nordea’s deal in November. The order book exceeded €4.2bn for the €500m no-grow deal.

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