News -
KommuneKredit issues new 750m EUR long 7-year benchmark.
On Tuesday, the 3rd of September, KommuneKredit priced a new EUR 750 million benchmark transaction maturing the 4thof March 2032 at EUR MS+22bps representing a spread of 54.3bps over DBR 0% Feb-32.
On Monday, the 2nd September 2024, KommuneKredit announced the mandate for a new long 7-year EUR benchmark at 11:52 CET.
Following constructive feedback overnight the orderbook officially opened on Tuesday, the 3rd of September at 09:15 CET, with an initial spread guidance of MS+24 bps area.
Investor demand was robust from the outset with the orderbook accelerating above €1.15bn by 10:50 CET where spread guidance was revised 1bp tighter to MS+23bps area. The orderbook continued growing steadily following the first update, reaching above €1.35bn by 12:04 CET supporting a further 1bp move tighter to set the spread at MS+22bps. The size of the transaction was subsequently set at EUR 750m.
At 15:28 CET, the transaction officially priced at MS+22bp, equivalent to a reoffer yield of 2.698% and 54.3bp over the DBR 0% Feb-32.
The final order book was in excess of 1,4 bn EUR across 49 investors and highly diversified across the EMEA with investors based in Nordics as well as the Germany/Austria/Switzerland-region taking each 21% followed by BeNeLux at 15% and UK/Ireland at 11%. In terms of investor type, Bank Treasuries were allocated 55% of the bonds, while the transaction also attracted strong participation from Asset Managers / Insurance / Corp / Pension Funds (allocated 26%) and Central Banks / Official Institutions (allocated 18%).
KommuneKredit has now issued EUR 4,2 billion of the expected EUR 5 billion long-term funding program for 2024.
Louise Rosentoft, Senior Funding & IR Manager at KommuneKredit, states:
“We’re very happy to experience, that despite a busy post-summer market reopening, the EUR-investor community recognizes our name and quality and are once again willing to finance investments into the sustainable transition of the Danish local communities.”
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LEAD MANAGER QUOTES
“Congratulations to the KommuneKredit team for a highly successful EUR 750m long 7yr benchmark. Testament to KommuneKredit’s standing in the SSA market, the transaction achieved a granular, high-quality orderbook which supported 2bps tightening with investors exhibiting limited pricing sensitivity. This was even more impressive in the context of heavy EUR supply, including issuance from peers in the same region. Barclays is honored to have supported this new issue.”
Francesco Polon, Director, SSA Origination at Barclays
“Congratulations to the KommuneKredit team for their new EUR 750mn long 7y transaction. Their large diversified orderbook is a testimony to their strong investor following, particularly as they were able to navigate a busy EUR primary market. BNP Paribas is delighted to have been part of this transaction.”
Salma Guerich, SSA DCM at BNP Paribas
“Congratulations to KommuneKredit on a successful long 7y deal and navigating a very busy new issue market. The issue showed an in-line new issue concession as we have seen from other issuers. Todays issue completes 85% funding of KommuneKredit’s 2024 funding need.”
Bo Søndergaard, Head of SSA at Danske Bank
"TD was delighted to be part of KommuneKredit's largest Euro-denominated benchmark of 2024. Amidst a busy month for SSA primary markets, the success of KommuneKredit's EUR transaction was captured in a high-quality & diversified orderbook - definitely a testament to the continued support of investors for the KommuneKredit name. Many congratulations to the KommuneKredit Funding team for the impressive result."
Paul Eustace, Managing Director, Global Co-Head of SSA and Head of Europe and Asia Syndicate at TD Securities
