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KfW issues its first ever 7 year Euro-Benchmark
Frankfurt (ots) - KfW Bankengruppe has today issued a Euro 3 billion seven-year benchmark bond. Having already placed a ten-year, a five-year and a three-year bond in the classical maturities earlier this year, KfW has now launched a seven-year Euro-Benchmark for the first time. As expected, demand of institutional investors was strong, which lead to a quick oversubscription of the bond.
The new Euro Benchmark IV/2009 matures on 04 July 2016 and pays a coupon of 3.125% p.a. The re-offer price was set at 99.935%, yielding 3.138% and equating to a spread of 39.4 basis points over the German government bond due July 2016. The transaction was lead managed by Barclays, HSBC and UniCredit Group (HVB). The bond has been assigned the same top-notch ratings from Fitch Ratings, Moody's and Standard & Poor's (AAA / Aaa / AAA) as all KfW bonds.
Despite the advanced stage of the year investors are still looking for liquid, high quality credits in the seven-year-segment and KfW responded to cater to this demand. Having issued approximately Euro 70 billion in 2009 out of its funding requirement of around Euro 75 billion, KfW capped the deal at Euro 3 billion size from the outset.
From the very beginning, the transaction captured current market momentum. Within a matter of hours the orderbook amounted to over Euro 2 billion so that the initial price talk in the marketing phase of "10 to 12 basis points" over the swap curve was adjusted to 10 basis points. The final orderbook amounted to over Euro 4 billion, containing strong demand from central banks and banks. More than 200 investors participated in the issue.
The geographical breakdown of the order book is as follows:
- Germany: 31% - UK: 13% - Italy: 6% - France: 5% - Switzerland: 5% - Other: 13%
Asia: 25% Americas: 2%
Breakdown by investor type:
Banks: 48% Central banks: 27% Funds: 15% Insurance companies: 9% Other: 1%
With the current issue the funding volume raised in the capital market this year has so far reached EUR 72.6 billion, and KfW has completed its Benchmark Programmes for 2009. These Programmes account for the lion's share of the volume: including today's issue, since the beginning of the year KfW has already raised EUR 19 billion under its Euro Benchmark Programme as well as USD 21 billion in seven transactions under its USD Programme.
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 Euro Benchmark IV/2009 - 3.125%
- Maturity 04 July 2016
Issuer: KfW Guarantor: Federal Republic of Germany Rating: AAA (Fitch Ratings) / Aaa (Moody's) / AAA (Standard & Poor's) Size: EUR 3,000,000,000 Maturity: 02 December 2009 - 04 July 2016 Coupon: 3.125% p.a Reoffer price: 99.935 Yield: 3.138% p.a. Format: Global Listing: Frankfurt
Lead Managers (3):
HSBC UniCredit Group (HVB)
Senior Co-Lead Managers (4):
Deutsche Bank DZ Bank Landesbank Baden-Württemberg
Co-Lead Managers (10):
Banca Akros Gruppo BPM
BNP Paribas Calyon Citi Danske Bank A/S Goldman Sachs JP Morgan Morgan Stanley Société Générale Corporate & Investment Banking UBS
Selling Group (8):
Fortis ING Natixis Nomura Nordea Bank Danmark A/S Santander SEB