CaixaBank issues €1bn in 5-year senior bonds, attracting demand for over €2.5bn

71% of the issue was taken up by international investors

• This is CaixaBank's third issue on capital markets this year. In the first quarter it issued €1bn in senior bonds and a further €1bn in mortgage covered bonds, both of which received strong demand.
• The price established for the issue, 245 basis points over the midswap rate, was better than anticipated thanks to significant oversubscription.
• The issue strengthens CaixaBank's already excellent liquidity levels. At the close of the first quarter the bank's liquidity stood at 61,325 million euro.

CaixaBank, one of Spain's leading banks, today successfully completed a €1bn issue in 5-year senior bonds, attracting demand in excess of €2.5bn.

The issue price was established at 245 basis points over the midswap rate, the benchmark index for this kind of issue, which was below the initial price (255 bp) thanks to powerful demand. The coupon rate was 3.125%, while the issue cost implies a spread of 24 basis points over Spanish government bond yields for the same term.

The new issue comes as part of the 2013 financial plan aimed at reinforcing CaixaBank's already excellent liquidity position, which is a cornerstone of the bank's strategy of financial prudence. As per 31 March 2013 the bank's liquidity stood at 61,325 million euro, up by 8,233 million euro in the first quarter, nearly all of which is readily available and represents 16.7% of total assets.

CaixaBank also remains highly solvent, with a core capital ratio (Basel II) of 10.6%, following the incorporation of Banco de Valencia and the early repayment of 977 million euro in support money provided by the Fund for Orderly Bank Restructuring (FROB) to Banca Cívica.

Strong demand for CaixaBank issues

In January CaixaBank successfully completed a €1bn issue of 3-year senior bonds, attracting demand of more than €5bn. In March it placed €1bn in mortgage covered bonds on the markets, generating demand of over €2.7bn.

CaixaBank, overseen by its CEO Juan María Nin, has taken advantage of favourable market conditions to continue its program of institutional issues, while demonstrating the confidence that wholesale markets have in the bank and the value that they place in its strengths. The latest issue was very warmly received by institutional investors, who placed more than 160 orders. There was particularly strong interest from international investors, demonstrating how much demand there is abroad for CaixaBank's issues.

International investors take up 71% of the placement

71% of the issue was placed among international investors, mainly countries such as the United Kingdom, France and Germany, with a strong showing from investment and pension fund managers, insurance firms and private banks.

CaixaBank expects the senior bond issue to be allocated credit ratings from Moody's, Fitch, Standard & Poor's and DBRS of Baa3, BB, BBB- and A low respectively. The operation is considered a benchmark issue, meaning the securities will be tradable on the major global bond markets.

The underwriters of the issue were Barclays, CaixaBank, Crédit Agricole, Goldman Sachs and HSBC.