Rating: Aa3/A+
Amount: Huf10bn
Maturity: January 29, 2007
Issue price: 100.225
Fixed re-offer price: 98.60
Coupon: 7%
Launched: Monday January 14
Joint leads: TD Securities (books), HypoVereinsbank
Bookrunner's comment:
TD - This was a successful issue, trading up to 98.90 on the offer side after launch. The 28bp spread over the government curve that we were able to get from the swap drove the issue. Distribution was in Germany, Switzerland and elsewhere.
Market appraisal:
HVB - For some reason the Bank Austria name still attracts a slightly better retail bid than the HypoVereinsbank name. We went for the forint market because it is the best place to get levels over the government.
The swap spread in zloty is too tight, while the Slovak swap market is too costly. Liquidity in the Hungarian swaps market, however, has improved in the one to five year area.
"...forint swaps have improved, but are still pretty illiquid. The bid/offer on the five year is 30bp, down from about 50bp last year. In Czech korunas it is 5bp, in zloty 10bp-15bp."
