KBC’s state aid Coco pops up encouraging $5bn book

18 Jan 2013

Investors demonstrated strong support for KBC Bank’s long-awaited contingent capital bond on Thursday, pushing orders to over $5bn by late afternoon. The deal, which is set to be priced on Friday, will help the Belgian borrower repay its state aid early.

Some market participants said they thought the initial price thoughts of mid-8% area were too tight. But with books reaching over $3bn just before midday London time, most said the trade was benefiting from investors’ hunger for yield.

"People underestimate the technical aspect of coming with yield," he said. ...

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