Popular LBBW tier two hints at renewed demand for bullet format
LBBW did not have to pay a premium to launch a tier two in 10 year bullet format on Monday. A banker on the deal said that other issuers could follow suit, eschewing call options to take advantage of a renewed thirst for duration among investors.
LBBW hired ABN Amro, Banca IMI, HSBC, LBBW and UBS to arrange the sale of its tier two, which had its size capped at €500m from the outset.
Banks tend to structure tier two deals as 10 year bonds with call options after the first five years.But ...