Announcements

THE HELLENIC REPUBLIC

MINISTRY OF FINANCE | PUBLIC DEBT MANAGEMENT AGENCY

EUR 2.5 billion 1.875% new 15-year benchmark due 4 February 2035

Transaction Highlights

• On Tuesday, 28^th January 2020, the Hellenic Republic, rated B1/BB-/BB/BBL (stb/pos/pos/pos), issued a new €2.5bn 15-year fixed-rate RegS/144a benchmark due 4 February 2035. The transaction priced with a reoffer spread of mid-swaps+165bp, equivalent to a reoffer yield of 1.911% and a spread of +212.9bp over the DBR 4.75% Jul-34.
• This 15-year benchmark issue represents the bond with the longest tenor that has been issued by the Hellenic Republic since the onset of the financial crisis, in 2009. Furthermore, it constitutes the first time that the Hellenic Republic comes to the market with a new, all-new-money bond whose maturity is longer than 2032, the year when the long-term relief measures for the Greek debt are expected to expire. In this regard, the transaction demonstrates the trust of the investor community towards the Greek State and represents yet another illustration of the country’s return to “normality” in international capital markets.
• This transaction is also the first GGB syndication after the end of Hellenic Republic’s fiscal adjustment programme to be priced vs. mid-swaps, rather than yield, further highlighting Greece’s return to European government bond (“EGB”) space.
• The theoretical “fair value” of a new 15-year benchmark for the Hellenic Republic was estimated by the joint lead managers at mid-swaps+155bp. This was calculated using Greece’s existing credit curve, namely the interpolation of the GGB Jan-33 and Jan-37. This calculation suggests that this transaction offers to investors a concession of c.10bp.
• Comprised of 378 individual orders, the final orderbook totalled in excess of €18.8bn, which represents the largest orderbook for the Hellenic Republic since Greece completed the third fiscal adjustment programme in August 2018.

Issuance Timeline

• Following the upgrade of the credit rating of the Greek economy by Fitch to “BB” (positive outlook), the Hellenic Republic officially announced a new 15-year RegS/144a benchmark issue the afternoon of Monday, 27^th January 2020, with pricing expected in the near future subject to market conditions.
• At 8:21 LDN the morning of Tuesday, 28^th January, initial pricing thoughts (“IPTs”) for the new 15-year were announced at mid-swaps+175bp area. The transaction attracted very strong investor demand, with indications of interest (“IoIs”) reaching a record level for post-fiscal adjustment programme issuance after just an hour later, allowing books to officially open with guidance at mid-swaps+170bp area.
• The orderbook continued to grow with orders in excess of €17.5bn by 11:11 LDN, which allowed the reoffer spread to be set at mid-swaps+165bp. The orderbook closed at 12:00 LDN, with final orders in excess of €18.8bn.
• Thereafter, given the size of the orderbook and the quality of the orders received, at 13:01 LDN the size of the transaction was set at €2.5bn.
• At 15:59 LDN, the transaction was officially priced with a reoffer spread of mid-swaps+165bp, equivalent to a reoffer yield of 1.911% and a spread of +212.9bp over the DBR 4.75% Jul-34.

Orderbook Distributions

• The final orderbook was in excess of €18.8bn comprised of 378 distinct orders. The transaction enjoyed broad geographical spread, led by the UK (32%) and a total of 84% internationally distributed, outside of Greece. By investor type, real money investors led the distribution, with fund managers accounting for 68% of allocations.   

                          Distribution by Region                                                                                    Distribution by Type

These materials are not an offer for sale of the securities in the United States.  Securities may not be sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended.  The HELLENIC REPUBLIC does not intend to register any portion of the SECURITIES offering in the united states or to conduct a public offering of securities in the united states.