EBRD issues US$ 1.25 billion benchmark bond

By Svitlana  Pyrkalo

Execution highlights:

  • Well oversubscribed at mid-swaps – 3 bps
  • Very high interest from central banks from Asia and EMEA

The European Bank for Reconstruction and Development, rated triple-A, has priced a well oversubscribed new US$ 1.25 billion 5-year benchmark bond at mid-swaps – 3 basis point, on August 23, 2012.

Following considerable overnight interest after the initial announcement on the evening of Wednesday 22 August, the orderbook officially opened at 8:10 AM on Thursday and built quickly, driven largely by the central bank community from Asia and EMEA, reaching over US$ 1 billion within half an hour of opening. At 2:30 PM, the orderbook closed at over US$ 1.5 billion with all orders at reoffer.

Because of the size and quality of the orderbook, the EBRD priced an upsized US$ 1.25 billion transaction later in the day. The spread to Treasuries of 16.43bps, equivalent to mid-swaps-3pbs, was the tightest ever for an EBRD 5-year global benchmark.

Approximately 30 investors participated in the transaction, and the coupon paid, 0.75 per cent, is the lowest this year from a supranational issuer in the 5-year sector.

This transaction means that the EBRD has issued €5.25 billion equivalent so far in 2012.