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KfW successfully re-enters 5-year segment with a USD 3bn Global
Frankfurt (ots) - KfW´s policy of continued market presence in the USD market was demonstrated by its USD Global issue IV/2008. Once again KfW has shown its commitment by issuing a large, liquid 3 bn USD transaction. By announcing the transaction as early as last Friday significant interest was gathered for a successful start on Monday. This was the second USD 5-year issue from KfW in 2008.
The bond will have the same top-notch triple-A rating from Fitch Ratings, Moody's and Standard & Poor's as all KfW bonds. The USD 3bn issue with a settlement on April 28 matures on May 16 2013. With a coupon of 3.50% and a re-offer price of 99.54 it yields 3.60% s.a. This corresponds to a yield pick-up of 66.9 basis points over the current 5-year US Treasury maturing in March 31, 2013. The transaction was lead by Citi, Credit Suisse and Merrill Lynch. Co-Lead Managers were Barclays Capital, Goldman Sachs, HSBC, JP Morgan, Lehman, Mitsubishi UFJ, Morgan Stanley, Nomura, RBC Capital Markets and RBS.
Market conditions proved to be difficult, but given strong investor feedback, KfW decided to explore the 5-year segment. The transaction was announced on Friday with bookbuilding commencing on Monday Asian morning. The book benefited from very strong initial momentum driven by highest quality accounts out of the region. The deal was priced after only one day of marketing across all time zones. It is a very positive result to be able to execute so quickly.
"The 5 year segment is an attractive one," stated Horst Seissinger, head of Capital Markets of KfW, and added: "The recent backup in yields generated strong interest. With a volume of more than USD 3.1 bn the final order book was slightly oversubscribed and it was of the highest quality. This underlines again that KfW is perceived as a top-notch credit quality asset by investors worldwide". The demand of central banks with an allotment of more than 70% represents a record level.
The breakdown of the order book by sectors is as follows:
Breakdown by investor type:
Central Banks: 71% Funds: 24% Banks: 3% Others: 2%
Asia: 45% Americas: 29% Europe: 23% Others: 3%
KfW has announced refinancing needs of around EUR 70 bn for 2008. Its Benchmark Programmes will again account for the main share of the funds raised; for 2008 at least four EUR and four USD benchmark bonds are planned. Since the start of the year KfW has already issued a 10-year benchmark and a 3-year benchmark with a volume of EUR 5 bn respectively, as well as a 3-year, 5-year, 10-year USD Global with a volume of USD 5 bn, USD 4 bn and USD 3 bn respectively.
This press release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. KfW has registered the securities that are the subject of this press release for sale in the United States. The offering of the securities in the United States will be made by means of a prospectus that may be obtained from KfW and will contain detailed information about KfW and its management, financial statements and information about the Federal Republic of Germany.
Term Sheet KfW USD Global - USD 3 bn.
- 3.50 % - 2008/2013 -
Guarantor: Federal Republic of Germany Rating: AAA (Fitch Ratings)/Aaa (Moody's) /AAA (Standard & Poor's) Size: USD 3,000,000,000 Maturity Date: 28 April 2008 - 16 May 2013 Coupon: 3.50% p.a., semi-annual coupon, first long coupon Payment Dates: 16 May and 16 November, first coupon 16 November 2008 Re-offer-Price: 99.54 Yield: 3.60% semi-annually Format: Global Stock Market Listing: Luxembourg
Lead Managers (3):
Credit Suisse Merrill Lynch
Co-Lead Managers (10):
Goldman Sachs HSBC JP Morgan Lehman Mitsubishi UFJ Morgan Stanley Nomura Securities RBC Capital Markets RBS