KommuneKredit launches new 12-year EUR 500 million benchmark
On Thursday 12th January, KommuneKredit priced a new EUR 500 million (no-grow) Jan-35 benchmark.
The orderbook officially opened on Thursday the 12st of January at 09:00 CET, with an initial spread guidance of MS+21 bps area.
Despite the non-benchmark maturity, the book was almost full at first book update, and the re-offer spread was fixed at MS+21bp. At noon CET the book closed with a good representation from high quality investors across Europe.
At 12:18 CET, the transaction officially priced at MS+21bp, equivalent to a reoffer yield of 2.956% and 70.5bp over the DBR 0.000% May-35.
In terms of geographical distribution, the transaction was broadly diversified across Europe, with the largest proportions of investors coming from Germany (38%), UK & Ireland (17%) and France (16%). In terms of investor type, Bank Treasuries were allocated 44% of the bonds, while the transaction also attracted strong participation from Asset Managers (25%) and Central Banks / Official Institutions (20%).
Statement from KommuneKredit:
Louise Rosentoft, Senior Funding & IR Manager
“We are pleased to open the funding year with the addition of a new 12-year liquid reference point to our EUR-curve and to experience the continued support of the European investor community to the very specific funding needs of our business model.”
Lead Manager Quotes
“Despite a volatile market backdrop and a busy supply environment, KommuneKredit was able to successfully raise its first benchmark of 2023 and add a new liquidity point in the 12y part of the curve. Congratulations to all the teams involved.” Salma Guerich, SSA DCM, BNP Paribas
“Many congratulations to the KommuneKredit team on their first benchmark issuance of 2023. KommuneKredit was able to price a longer-dated €500 million transaction in a busy and volatile market. We were delighted with the successful outcome and to have been bookrunner on the transaction.” Ebba Wexler, MD, Head of SSA DCM, Citi
“We congratulate KommuneKredit on their first EUR transaction this year. It's great to see KommuneKredit being able to raise EUR 500m in an untested part of the EUR curve and in a historical busy primary market with higher New Issue Premiums. Danske Bank is very proud to support KommuneKredit in their first deal of the year.” Bo Søndergaard, Head of SSA, Danske Bank
“Congratulations to the KommuneKredit team on issuing their first ever 12-year EUR benchmark; exploring a rare maturity, complemented by a swift execution process and pricing ahead of critical data releases. The diverse and high quality investor support is a testament to the investors' trust in the KommuneKredit name. We are delighted to be involved in this transaction.” Matthew Dawes, SSA Syndicate, JP Morgan