European Investment Bank

  • 21 Oct 2004
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 Rating: Aaa/AAA/AAA
Amount: R200m
Maturity: November 4, 2014
Issue price: 99.13
Fixed re-offer price: 97.455
Coupon: 8.5%
Launched: Friday October 15
Lead mgr: TD Securities

Bookrunner's comment:

The South African rand market continues to be dominated by Asian and Swiss institutions and retail, which have been the driving factor behind the increases of the EIB 8% 2013 transaction.

The EIB has been looking to offer new benchmark maturities, and as a result we brought a 2014 transaction with a 8.5% coupon and Deutsche followed with a 2010 maturity.

There are only a handful of investors involved in this market, but they are providing lead orders for these transactions and driving issuance.

EIB is the most pro-active issuer in supporting the rand market. It has local funding needs in rand and it is the premier choice when it comes to supranational issuers in the market.

The pricing is Jibor less the low 40s, which on a US dollar Libor equivalent basis would equate to around minus high 20s.

The transaction syndicated well and, with the lead orders we had, we are a little over 50% done on the issue.

Market appraisal:

?...EIB is an important name in the rand market and I assume the borrower wanted to open a new 10 year line.

I am not sure whether a R200m 2014 issue will work alongside a R2.125bn 2013 bond, which also has a current coupon. However, I expect TD has some lead orders behind it and I have no doubt the deal will find a home.?

?...we were one of the four co-leads with a R5m ticket, some of which we have sold.

There has been more issuance in this tenor than in the medium part of the curve with the $2.15bn 8% 2013 EIB issue the dominant transaction and is still current coupon with a cash price below 97.00.

The new 2014 is also current coupon and the issue price is under par so I am sure it will get taken down given time.?

?...I am not sure there is enough demand for South African rand to absorb two issues at the same time. Neither deal is particularly cheap ? but then the EIB is never cheap ? but the name is very popular with retail.

Yield levels in the rand market are reaching the stage where investors are coming back to the market.

Generally customers like the coupons on offer. They like to gamble on the currency, which is quite strong, and they seem to like the South African story.?

  • 21 Oct 2004

All International Bonds

Rank Lead Manager Amount $bn No of issues Share %
  • Last updated
  • Today
1 JPMorgan 92.59 388 8.96%
2 Citi 85.30 278 8.25%
3 BofA Securities 63.15 265 6.11%
4 Barclays 58.01 223 5.61%
5 Deutsche Bank 55.74 184 5.39%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $bn No of issues Share %
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1 BNP Paribas 60.87 123 14.06%
2 Credit Agricole CIB 28.59 93 6.60%
3 Santander 25.41 90 5.87%
4 JPMorgan 23.88 61 5.52%
5 UniCredit 21.51 103 4.97%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $bn No of issues Share %
  • Last updated
  • Today
1 Goldman Sachs 2.07 11 10.42%
2 BofA Securities 1.40 6 7.01%
3 Citi 1.37 7 6.87%
4 Morgan Stanley 1.36 6 6.85%
5 JPMorgan 1.31 7 6.59%