Europese Investeringsbank overschrijdt financieringsprogramma 2012 (en)

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  Transaction driven by strong demand from major Asian Central bank investors in addition to a strong show of support from Eurozone investors
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  High quality book close to EUR 4.5 billion
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  With this new issue, EIB i refreshes its EARNs curve with a new on-the-run 10-year benchmark

On Tuesday 18th September 2012, the European Investment Bank priced it’s third new Euro Area Reference Note (EARN) of 2012, and the first 10-year benchmark maturity EARN since September 2011, providing a new liquid point on the EIB EARN curve. With this issue EIB has achieved and exceeded its 2012 funding programme of EUR 60bn.

The bond was priced at a spread of mid-swaps +49bps, from an initial guidance of mid-swaps +48 to +50bps. This equates to a spread at the time of pricing of +76bps over the Bund 1.75% due July 2022, and +10.8bps over the OAT 3% due April 2022.

EIB announced the intention to issue a new 10-year EARN benchmark on Monday, 17th September. Order books were opened on Tuesday morning, 18th September, with the price guidance of mid swaps +48 to +50bps. The orderbook built strongly within 2 hours, closing at nearly EUR 4.5bn and comprising 162 orders. The deal size was set at EUR 3bn and the transaction was priced at mid swaps +49bps.

The orderbook was driven by large interest from Asian official institutions in particular (taking around 50% of the issue). Strong support also came from the real money investor community, reflected by the distribution to fund managers (22%) and insurances (8%).

Composition of demand for the issue:

Summary Terms and Conditions for the new Bond Issue

Comments on the issue:

Bertrand de Mazières, Director General of Finance at the EIB, said: “This was a solid and well-received transaction, all the more so given intra-day volatility in the underlying market and the challenging nature of benchmark issuance in this part of the curve.”

Jeremy Shaw, Co-Head of Rates Syndicate at Barclays said “EIB has once again demonstrated its broad based support with strong investor interest anchored in both Asia and Europe while cementing its position as a key liquidity provider for core SSA bond markets through the creation of a successful new current coupon 10-year benchmark.”

Chris Lees, Managing Director, European Syndicate at BofA Merrill Lynch said “Great transaction from EIB. They’ve watched the market closely and timed their response nicely to meet investor needs as the European dynamic continues to evolve. The result has been strong backing from their core investor group backed up by a breadth of European real money to get a materially oversubscribed book.”

Edward Mizuhara, Head of SSA Syndicate at Credit Suisse said: “An extremely strong 10-year benchmark execution in a low rate environment, particularly given underlying market drifting slightly wider. Given the back drop, we opened up at 48-50 over swaps and were able to drive a highly diversified order book which ultimately priced at +49, within the context of the initial price thoughts despite a slightly weaker underlying market. The EIB’s responsible approach to the EARN benchmark issuance programme is greatly appreciated by investors globally, who showed their support for the trade with over 160 orders.”

Zeina Bignier, Deputy Head of Debt Capital Markets at SG CIB said: “The transaction was well timed enabling the issuer to take advantage of a strong demand from European and Asian real money investors. The new 10y EARN benchmark further completes EIB’s benchmark curve and highlights the strong investor appetite for longer dated EIB bonds.”

For further information please contact:

Carlos Ferreira da Silva: +352 4379 86019

BACKGROUND INFORMATION ON EIB

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy goals. The Bank’s strong credit standing is underpinned by exceptional asset quality, a strong capital base, firm shareholder support, conservative risk management and a sound funding strategy.

ENDS