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KommuneKredit launches new 20-year EUR 500 million benchmark

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KommuneKredit launches new 20-year EUR 500 million benchmark

On Wednesday 19th April, KommuneKredit priced a new EUR 500 million (no-grow) Apr-43 benchmark.

The orderbook officially opened on Wednesday the 19th of April at 09:00 CET, with an initial spread guidance of MS+52 bps area.

The deal started on a strong footing, with the orderbook reaching more than EUR 1.5 billion (excluding JLM interest) at 10:50 CET, at which point the spread was set 3bps tighter, at MS+49bps. Hereafter the momentum continued unabated with final books closing in excess of EUR 1.8 billion (excluding JLM interest) at 11:30 CET.

At 14:30 CET, the transaction officially priced at MS+49bp, equivalent to a reoffer yield of 3,455% and 83,8bp over the DBR 3.25% 07/2042.

The book attracted strong support from insurance & pension funds (allocated 38%) and asset managers (34%) while also attracting central banks and official institutions (17%). In terms of geographical distribution, the transaction was broadly diversified across Europe, with the largest proportions of investors coming from Germany (53%), France (15%) and The Netherlands (9%).

Statement from KommuneKredit:

“After a three-year absence from the long end of the EUR benchmark market, we are very pleased to experience such a strong reception from the investor community.” Daniel Aagaard Pedersen, Head of Funding and Investor Relations

Lead Manager Quotes

“The CACIB team was very pleased to contribute to KommuneKredit’s successful return to the EUR market. The outstanding result of today’s new 20-year EUR benchmark underlines KommuneKredit’s strong position within the SSA market. The combination of an oversubscribed orderbook and the quality of investor participation demonstrates KommuneKredit’s ability to capture key investor demand at the long-end of the EUR curve. Many congratulations from CACIB.” Lawrence Duquesne-Garner, SSA DCM Origination at Credit Agricole CIB

“KommuneKredit accessed the more challenging Euro long-end in fine style with its recent 20yr benchmark. The deal generated ample investor demand, with a 3.6x oversubscribed final orderbook for EUR 500m (no-grow) size in unison with a 3bp spread compression. This result is highly commendable given the element of price discovery at the long-end of the curve and mixed reception to recent EUR SSA supply. Congratulations to the team!” Shadé Sharaka, Head of SSA DCM Syndicate, Europe at HSBC

"Congratulations to the KommuneKredit team on a stellar trade, successfully navigating a busy EUR supply week. Today's issuance is one of the few long-end EUR agency trades of the year and highlights the value investors place on KommuneKredit's core currency offerings. The high quality and granular order book, more than 3.6x oversubscribed, saw insurance & real money accounts take the lion’s share of allocations. Morgan Stanley is delighted to have been involved." Ben Adubi, Head of SSA at Morgan Stanley

"Today KommuneKredit extended duration of its curve with a new 20Y transaction that stole the spotlight to attract high-quality demand, despite a market backdrop that remains volatile. Not only was this the first time the issuer has come on this tenor since 2020, but it navigated in a context of limited supply in this space since the start of Q2. The success speaks directly to the strategy taken by the KommuneKredit team and it was a pleasure to have been a part of this outcome that surpassed all expectations." Thomas Leocadio, Co-Head Public Sector Origination at Natixis


Jens Lundager

Jens Lundager

Press contact CEO +45 3369 7622