ICO launches a benchmark issue for EUR1,250 million

ICO launches a benchmark issue for EUR1,250 million

The issue has the lowest coupon ever in a benchmark issue in euros, 0.375%

The tightest spread in recent years was obtained versus Spanish treasury bonds

Foreign investors acquired 83% of the bonds

Instituto de Crédito Oficial (ICO)  launched a new benchmark issue of two-year bonds in euros under the GMTN (Global Medium Term Note) programme. The strong demand allowed ICO to raise the volume of the issue from the initial objective of €1,000 million to €1,250 million.

This benchmark issue, maturing in October 2016, has a coupon of 0.375%, the lowest coupon ever for a benchmark issue in euros. Similarly, the spread for Spanish treasury bonds was the tightest obtained in recent years.

This issue was led by BBVA, BNP Paribas, Crédit Agricole and Societe Generale.

The transaction generated enormous interest and support from foreign investors, especially European investors, who acquired 67% of the issue. The rest of the issue was distributed in Asia & Middle East (16%) and in Spain (17%).

By type of investor, bank treasuries led the distribution with 40% of the deal, followed by asset managers with 29%. Central bank participation deserves to be highlighted with 19%, the largest percentage in recent years. Pension funds subscribed the remaining 12%.

This new issue in euros, along with the issues launched this year in dollars, pounds and yen, confirm the gradual normalisation of the financing conditions for Spanish issuers.