Terms of the transaction
Issuer: European Bank for Reconstruction and Development (EBRD)
Rating: Aaa / AAA / AAA (all stable) (Moody’s / S&P / Fitch)
Documentation: Issuer’s Global MTN programme
Format: Global SEC exempt
Issue Amount: GBP 550,000,000
Pricing Date: 9th January 2019
Settlement Date: 18th January 2019 (T+7)
Maturity Date: 18th January 2022
Coupon: SONIA+26bp, Act/365, 5 day observation lag, Quarterly, Act/365F
Documentation: Issuer's Global Medium Term Note Programme
Target Market: Eligible counterparties, professionals and retail (all distribution channels)
Joint Bookrunners: Barclays, J.P. Morgan (B&D), NatWest Markets
On Wednesday, 9th January 2019, the European Bank for Reconstruction and Development (EBRD), rated Aaa (stable) / AAA (stable) / AAA (stable), successfully issued its inaugural GBP 550 million 3-year SONIA-linked floating rate note. The new bond, which matures on the 18th of January 2022, pays a coupon of SONIA+26bp and priced at a reoffer price of 100%. The transaction represents EBRD’s first ever SONIA-linked syndicated floating rate note. Barclays, J.P. Morgan, and NatWest Markets acted as Joint Bookrunners.
Amidst a busy primary market, EBRD announced the bond mandate at 16:00 GMT on Tuesday, 8th January. The deal was marketed with initial pricing thoughts (“IPTs”) of SONIA +26bps area.
Just before 7:45 GMT the following morning, the Joint Lead Managers opened books, setting the re-offer spread at SONIA+26bp. The orderbook developed quickly over the course of the early morning session, growing to in excess of £250mn (exl. JLM interest) by approximately 9:30 GMT. At 9:37 GMT, this progress was communicated to the market.
The orderbook continued to grow and at 11:20 GMT, with books approaching £570mn, an expected transaction size of £500mn was announced, along with the message that books would close at 11:45 GMT.
The high quality of the orderbook enabled the deal to be up-sized to £550mn. At 14:45 GMT, the transaction priced.
Banks comprised the largest percentage of the total allocation (at 95% of the bonds), with UK based institutions accounting for a similar proportion.
Investor Type Geography
Banks 95% UK 96%
CB / OIs 3% Europe (ex. UK) 4%