Piraeus Financial Holdings S.A. (hereinafter called “Piraeus”) announces that it has successfully completed the pricing of a new €650 million Subordinated Tier 2 Bond (hereinafter called the “Bond”) with a coupon of 5.375%, attracting the interest of a large number of institutional investors. The Bond has a maturity of 11 years and an embedded issuer call option of 6 years, with settlement taking place on 18 September 2024. The Bond will be listed on the Luxembourg Stock Exchange’s Euro MTF market and is expected to be rated Ba3 by Moody’s.
In conjunction with the new issue, Piraeus announced a cash tender offer on its outstanding €500 million, 5.50%, Fixed Rate Reset Tier 2 notes due 19 February 2030. The funds raised through the new issue will be used by Piraeus for financing the tender offer and for further solidifying its capital position.
Pro forma for the new issuance, Piraeus’ total capital ratio as at 30 June 2024 stands at 19.4%, while the pro forma minimum requirements of own funds and eligible liabilities (MREL) ratio of Piraeus Bank Group as at the same date stands at 28.7%.
The transaction attracted significant interest from approximately 200 institutional investors, with 57% placed among asset managers, insurance companies and pension funds, 27% with banks and private banks, 13% with hedge funds and 3% with other investors.
The total order book of the transaction exceeded €2.7 billion, reflecting an oversubscription of 5.4 times compared to an initial issuance target of €500 million. On the back of strong investor interest, the final spread over the 6-year mid swap rates was set at 315 basis points, versus an initial guidance of 340 basis points, resulting in a fixed coupon of 5.375%, paid annually, with an issue price of 99.50%. More than 75% of the issue has been allocated to international institutional investors.
Barclays, Deutsche Bank, Goldman Sachs Bank Europe SE, Morgan Stanley, Nomura and UBS Europe SE acted as Joint Lead Managers of the issue. Allen & Overy and Bernitsas Law Firm acted as legal advisors to Piraeus.
Athens, 11 September 2024