Announcements

ISSUANCE OF 10-YEAR BOND GGB

                                  

 

 

 

PRESS RELEASE – 5th March 2019

 

The Hellenic Republic

(Moody’s B1 Stable, S&P B+ Positive, Fitch BB- Stable, DBRS BH Positive) EUR 2.5 billion GGB 3.875% due 12th March 2029

 

Summary Terms

 

Format:                                   Reg S Category 1, 144a eligible, CACs

Size:                                        EUR 2.5 billion

Pricing Date:                           5th March 2019

Settlement:                             12th March 2019

Maturity:                                  12th March 2029

Coupon:                                   3.875%, Annual ACT/ACT

Re-offer Spread:                     DBR 0.25% 02/29 +373.2bps

Re-offer Yield:                         3.900%

Re-offer Price:                         99.796%

Listing:                                     Athens Stock Exchange

Denominations:                       EUR €1,000 x €1,000

Lead Managers:                       BNP Paribas, Citi, Credit Suisse, Goldman Sachs, HSBC, J.P. Morgan

 

Transaction Highlights

  • On Tuesday 5thMarch the Hellenic Republic, rated B1 Moody’s/ B+ S&P/ BB- Fitch/ BH DBRS (stb/ pos/ stb/ pos), priced a €2.5 billion 10-year Government Bond (GGB) due 12th March 2029. The new benchmark carries a coupon of 3.875% and reoffer yield of 3.900%, equating to a reoffer price of 99.796%. Joint bookrunners on the transaction were BNP Paribas, Citi, Credit Suisse, Goldman Sachs Intl, HSBC and J.P. Morgan.
  • This transaction is the Hellenic Republic’s second syndicated benchmark of 2019 as it follows the success of the €2.5 billion 3.45% long 5-year benchmark issued in January. It also the longest maturity syndicated by the Hellenic Republic since their return to capital markets and is their first 10-year syndicated benchmark since 2010.
  • The transaction benefited from the continued positive backdrop for Greek Government Bonds since the start of the year. On Friday 1st March, Moody’s upgraded the Hellenic Republic from B3 to B1 and the GGB Apr-24s have tightened ca. 80 basis-points since issuance.                                 
  • The new issue also demonstrates the continued normalisation of the Hellenic Republic’s access to markets. Though the GGB Apr-24s set many records, this new 10-year has surpassed it in terms of number of investors and book size, at over 380 and €11.8 billion respectively, whilst also pricing at the tight end of the range at 3.90%.
  • This new GGB 10-year provides another reference point on the Hellenic Republic’s curve, filling the gap between the GGB Jan-28 and GGB Jan-33s, as well as an on-the-run comparable to the 10-year bonds of Republic’s European sovereign peers.

  

Execution Summary

  • Following strong performance of the recent 5-year benchmark, an upgrade by Moody’s and supportive primary market conditions, the Hellenic Republic announced their intention to issue a new 10-year benchmark on Monday, 4th March at 10.15 GMT.
  • The initial market reaction to the announcement was positive, and IPTs of 4.125% area were released on Tuesday, 5th March at 08.15 GMT.
  • Strong interest in the transaction was immediately evident and within only one and a half hours IOIs reached in excess of €10 billion (including 795 million joint-bookrunner interest). Guidance was therefore set in a range of 3.90 – 4.00% at 09.45 GMT.
  • At 10.45 GMT, the final spread was set at 3.90% - the tight end of the range – as books had continued to increase quickly and reached in excess of €11.3 billion by this time. Books were subsequently closed at 13.30 GMT in excess of €11.8 billion (including 800 million joint- bookrunner interest).
  • The transaction benefited from a granular (380+ accounts), high quality (89% Real Money accounts), and diversified investor base (89.5% allocated internationally), paving the way for the Hellenic Republic’s continued normalized access to the capital markets.