KommuneKredit issues new 750m EUR long 8-year benchmark

On Wednesday 15th of January, KommuneKredit priced a new EUR 750 million benchmark transaction maturing 17^thof March 2033 at EUR MS+41bps representing a spread of 43bps over DBR 2.3% Feb-33.

On Tuesday 14th January 2025 KommuneKredit announced the mandate for a new long 8-year EUR benchmark at 10:00 CET.

The orderbook officially opened the following morning at 08:50 CET, with an initial spread guidance of MS+44 bps area and benchmark size (in the context of €500m-750m).

Investor demand was strong from the outset and under two hours into the offering, the €750m was well covered with books in excess of €3bn. At 10.30 CET the transaction was launched with the spread revised by 3 bp and set at MS+41bps and a size of €750m. With spread set, the orderbook continued to grow and closed in excess of €3.5bn.

At 14.11 CET, the transaction officially priced at MS+41bp, equivalent to a reoffer yield of 2.944% and 43bps over the DBR 2.3% Feb 2033.

The final order book was based on orders from more than 90 investors, highly diversified across the EMEA and Asia with investors based in the Germany/Austria/Switzerland-region representing 27% of the allocated bonds, followed by Nordic investors at 18%. In terms of investor type, the bulk of demand came from banks at 51%, with strong participation also from central banks and official institutions (24%).

This was KommuneKredit’s first syndicated transaction in 2025 of the expected EUR 5 billion long-term funding program for 2025.

Statement from KommuneKredit

“The funding year has opened in a flurry of record setting order books for SSA-issuers worldwide. In light of this it is reassuring and fills us with gratitude to experience that so many investors, widely spread across Europe, Middle East and Asia, chose to support KommuneKredit in our mission to provide financial leeway for communities, large as well as small, across Denmark.”

Louise Gregersen, Senior Funding & IR Manager at KommuneKredit

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Lead Manager Quotes

"Congratulations to the KK team for successfully launching their first benchmark transaction of 2025. Despite a busy EUR primary market, the issuer capitalized on its excellent standing with investors to secure a triumphant execution. By targeting the long 8-year maturity, they effectively tapped into deep investor interest as demonstrated by the high quality of the order book, with significant interest from Central Banks and Official Institutions. The strong oversubscription combined with KK’s solid credit perception enabled to revise the pricing straight away 3bps inside IPTs."

Katrin Wehle, Head of SSA DCM Origination, Deutsche Bank

“Congratulations to the KommuneKredit team on an excellent first trade of 2025! The success of today's new 8Y benchmark transaction is a testament to KommuneKredit's strong investor following, achieving a record book in excess of €3.5bn. The diverse and high-quality orderbook, that was 4.7x oversubscribed, supported an impressive one-step 3bps tightening from IPTs. HSBC is delighted to have been a part of this transaction.”

Robert Mandziara, Director, HSBC

"The new 8-year Benchmark transaction from KommuneKredit is a huge accomplishment, garnering their largest book in nearly 8-years! A deftly timed transaction, during a quiet window in a EUR market that has been undersupplied in 2025 versus previous years. As such, the transaction received maximum attention from the global investor base and the success is a testament to the credit quality of KommuneKredit. Huge congratulations to the KommuneKredit team.”

Mark Yeomans, Managing Director, Nomura

"Huge congratulations to the KommuneKredit team for a very successful first outing of the year in the EUR market. The size and the depth of the order book underscores the strong support for KommuneKredit in the investor community, and the pricing at Fair Value in a historically busy Euro market is yet another testament to KommuneKredit’s credit and work in the markets over the years. Nordea is honored to have been involved in this landmark bond issuance.”

Marcus Viitamäki, Head of SSA DCM, Nordea