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Tuesday, September 26, 2023

Bank of Cyprus got 11.87% for 220 million AT1 bonds

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The Bank entered the markets – Demand from the investment public reached 2.2 billion euros

Επιασε 11.87% η Τραπεζα Κyπρ ου για 220 εκατ. ομολoγων ΑΤ1

Επιασε 11.87% η Τραπε ζα Κύπρου για 220 εκατ. ομολογων ΑΤ1 to 11.87%, a value which is lower than the one achieved in the summer of 2018 with 12.5%.

Demand for the bonds from the investing public reached 2.2 billion euros, while 11.87% of the issue is characterized as particularly good for the conditions of the 2023 market and the international bond environment. The issue was undertaken by BofA Securities, Goldman Sachs Bank Europe SE, J.P. Morgan and BNP Paribas.

As noted by other media outside Cyprus, the Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA) also issued an AT1 bond.

On Monday, June 12 (yesterday), the Bank announced that it is inviting the holders of the existing Tier 1 fixed rate additional capital securities of a nominal value of €220 million to offer the capital securities for purchase by the bidder at a purchase price equal to 103% of the nominal value of the Capital Securities, payable in cash, subject to the fulfillment of the New Issue Condition.

It is noted that today's issue in the markets, which achieved 11.87%, is parallel to the above “call” to the holders of the 2018 AT1 bonds. However, priority was given to the holders of the 2018 AT1 bonds in the new issue, that of June 13 if they chose to “offer them back” with a purchase price equal to 103%.

By December 2023, the Bank of Cyprus had announced that it would replace (refinancing) the loan it had in December 2018. As he explained in the results of the end of 2022 the Bank, “the Additional Capital Category 1 (AT1) are unsecured and subordinated obligations for the Company and bear an annual interest rate of 12.5%. The interest is paid semi-annually retroactively and is reset every five years, while explains that the Additional Tier 1 (AT1) has no maturity date and the Company has the right to early redemption on the fifth anniversary of their issue date (i.e. on 19 December 2023) and on each subsequent fifth anniversary, subject to receipt of the necessary supervisory approvals. In the event that Additional Tier 1 (AT1) Funds were not redeemed early, the coupon would reset on the fifth anniversary of its issue date (i.e. 19 December 2023).

Source: www.kathimerini.com.cy

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