Euro FRNs

  • 16 Feb 2001
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* Banque PSA Finance

Rating: A3/A-

Amount: Eu200m

Maturity: August 21, 2002

Issue/re-offer price: 99.97

Coupon: three month Euribor plus 10bp

Launched: Friday February 9

Sole mgr: CAI

* Bayerische Landesanstalt für Aufbaufinanzierung

Deficiency guarantee from: Freistaat Bayern

Amount: Eu300m Inhaberschuldverschreibung Series 218

Maturity: February 27, 2006

Issue price: 99.944

Coupon: six month Euribor minus 8bp

Launched: Wednesday February 14

Lead mgr: SG

Bookrunner's comment:

The borrower is a rare visitor to the capital markets. Its last public offering was denominated in French francs and this marks its debut in the single currency.

LfA is the economic development agency of the Free State of Bavaria. As the institution is wholly owned by Bavaria, it benefits from an explicit deficiency guarantee.

The five year maturity enabled us to offer sufficient value to attract investors and to satisfy demand we had spotted for state guaranteed paper. There has not been much supply in recent months and this deal filled a gap in the market. The pricing was perceived as fair and we have been selling tickets at the re-offer level. The transaction was sold out before the syndicate broke.

Demand was apparent across Europe. We sold 31% into Germany, 20% into France, 23% to Benelux accounts, 9% to Swiss clients, 7% to Spanish investors. Scandinavian buyers accounted for a further 3%, while Italian investors bought 2% of the deal. Two-thirds of the paper was sold to bank accounts, while asset managers took 22% and insurance companies bought the remaining 11%.

Market appraisal:

"...the only negative thing about this was the small ticket size. Eu3m is not a floater size ticket. Normally this type of quality is priced on a tighter level. With KfW, for instance, you are looking at the double digit sub-Libor level. But overall this was a good transaction."

"...we bought a few bonds in addition to our allocation to have an institutional size. This will not be fully placed yet because they are reaching for institutionals, but that is not a problem. Pricing was on the cheap side."

"...tightly priced and impossible to sell our Eu3m ticket, this deal will have to rely entirely on German domestic placement."

* BGB Finance (Ireland) plc

Guarantors: Bankgesellschaft Berlin AG, Landesbank Berlin Girozentrale

Rating: Aa2/AAA (Moody's/Fitch)

Amount: Eu55m

Maturity: August 23, 2002

Issue price: 100.05

Coupon: three month Euribor plus 1bp

Launched: Friday February 9

Sole mgr: Credit Suisse First Boston

* Deutsche Apotheker und Aerztebank eG

Rating: A2/A

Amount: Eu50m

Maturity: August 19, 2002

Issue price: 99.97

Coupon: three month Euribor plus 9bp

Launched: Wednesday February 14

Sole mgr: Morgan Stanley Dean Witter

* KBC Ifima NV

Guarantor: KBC Bank NV

Rating: Aa3/A+/AA-

Amount: Eu500m

Maturity: February 28, 2006

Issue/re-offer price: 100.019

Coupon: three month Euribor plus 12.5bp

Spread at full fees: Euribor plus 16bp

Launched: Monday February 12

Joint leads: ABN Amro (books), KBC

Bookrunner's comment:

KBC Ifima is the financing arm of KBC and is based in the Netherlands. It is 100% owned and fully guaranteed by KBC Bank. The bank performed well in 2000 and has significantly improved in measures of efficiency and operating performance, with operating income of Eu831m as at 30/06/00. The bank remains one of Belgium's leading financial service providers, is the largest asset manager in the country and, through its sister company, KBC Insurance, is the fourth largest insurer in Belgium.

We began speaking to the borrower a couple of weeks ago about an inaugural public issue off their Eu6bn EMTN programme.

The name is extremely well known to accounts throughout Europe and is one of a diminishing number of banks enjoying a double-A rating. KBC does not have a single public FRN outstanding in the market so there are clearly plenty of lines available for the name.

The all-in pricing of plus 16bp is correct given the name recognition, credit rating and rarity value, and we marketed and sold the deal at 15.5bp. Other recent issues with the same rating include the Bank of Ireland five year trading at plus 16bp and UniCredito at plus 17bp.

We were three quarters sold at the end of the first day with some very large tickets being written into Germany. We not surprisingly saw good interest from Benelux, along with UK, French, Irish and Dutch accounts.

We were surprised by the amount of bonds bought back in the broker market after break of syndicate but suspect there are a couple of accounts which shorted the issue. We have closed the deal (Thursday) at 16bp-15.5bp.

Market appraisal:

"...probably a basis point too tight at 15.5bp which is where they are trying to sell the bond and people are expecting it to clear between 17bp and 16bp."

"...the first public issue by KBC so this is clearly a rare piece of paper and the name recognition is extremely high amongst European investors. It is perhaps a little large for the current market, which seems to have lost a lot of its steam this week, but it was definitely correctly priced to sell at around 15.5bp."

* Landeshypothekenbank Tirol AG

Rating: AA+

Amount: Eu215m

Maturity: February 27, 2006

Issue price: 99.894

Coupon: three month Euribor plus 6.25bp

Spread at full fees: Euribor plus 12bp

Launched: Tuesday February 13

Sole mgr: Credit Suisse First Boston

Bookrunner's comment:

A debut deal for the bank off its EMTN programme. We have been working on the deal for some time but the borrower has fairly aggressive funding levels and we have been trying to uncover demand at the price over the last few weeks.

We found one significant investor who liked the name and spread and we were able to approach the bank about bringing the deal.

We sold the whole amount to one investor, comfortably inside the all-in of Euribor plus 12bp.

* Okobank

Rating: A1

Amount: Eu150m lower tier two debt

Maturity: March 7, 2011

Issue/re-offer price: 99.778

Coupon: three month Euribor plus 60bp until 07/03/06; three month Euribor plus 210bp thereafter

Launched: Thursday February 15

Joint leads: Schroder Salomon Smith Barney (books), Okobank

Bookrunner's comment:

This was not a large deal and we had been premarketing it for a week. We were waiting for Okobank's results before pricing it, and once they came out, the deal was in such good shape that execution was really a formality.

Okobank is a well known name with a double-A senior rating and they do not issue a huge amount of debt. There has been extremely good demand for step-up callable FRNs.

There was very broad geographical distribution. We had buyers in the UK, the Middle East, Germany, France, Benelux and Spain.

  • 16 Feb 2001

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 %
  • Last updated
  • Today
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%