NIB issues 3-year USD 1.25 billion global benchmark
On 29 March, NIB priced a 3-year USD 1.25 billion benchmark, its first USD benchmark of the year. The transaction gained strong support from over 50 global investors, with the orderbook closing in excess of USD 1.7 billion.
“This is NIB’s first USD benchmark in 2022. Because of the elevated volatility, markets are not easy to navigate, and one has to make swift decisions to access the primary market. With interest rates and expectations changing rapidly, we saw a clear preference from investors for short-dated debt and therefore decided to issue a three-year bond. Reception was strong from the onset and a lot of long standing, regular investors in the NIB name participated. This encouraged us to set the bond size to USD 1.25 billion, which is slightly bigger than our usual issuance size”, says Jens Hellerup, Head of Funding and Investor Relations at NIB.
“NIB is an occasional but well-established high rated issuer. During volatile and challenging times as the ones we are currently facing, I believe investors see even more value in such an issuer. The team was able to capture a good issuance window and provided the right product to investors as there hasn’t been a lot of short-dated bond issuance. A spread of 10 basis point over the US Treasury is a very strong outcome in the current challenging market”, says Kim Skov Jensen, Vice-President, Chief Financial Officer at NIB.
“The combination of an extremely high-quality orderbook together with the preferred maturity for investors enabled the issuer to price a minimal new issue concession, something that hasn’t been achievable in recent weeks”, says Jez Walsh, Managing Director, Head of Syndicate, Daiwa Capital Markets.
The transaction was broadly distributed across geographies and investor types. Central banks and official institutions made up the main share with 62%, followed by banks with 27% and fund managers with 6%. Other investors made up the remaining 5%. Most demand originated from the Americas with 41%, followed by the EMEA region with 33% and Asia with 26%.
Joint lead managers for this global transaction are BofA, Citi, Daiwa and RBC CM. See a joint press release on the bond transaction (PDF).
| Bond summary | |
|---|---|
| Issuer: | Nordic Investment Bank |
| Rating: | Aaa / AAA by Moody’s / S&P |
| Issue amount: | USD 1,250 milion |
| Coupon: | 2.625%, SA, fixed |
| Launch date: | 29 Mar 2022 |
| Settlement date: | 05 Apr 2022 |
| Maturity date: | 04 Apr 2022 |
| Re-offer spread: | SOFR MS SA 30/360 +22bps |
| Joint lead managers: | BofA, Citi, Daiwa, RBC CM (DM/B&D) |
| ISIN: | US65562QBT13 |
NIB is an international financial institution owned by eight member countries: Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The Bank finances private and public projects in and outside the member countries. NIB has the highest possible credit rating, AAA/Aaa, with the leading rating agencies Standard & Poor’s and Moody’s.
For further information, please contact:
Mr Jens Hellerup, Senior Director, Head of Funding and Investor Relations, at +358 961 811 401, jens.hellerup@nib.int
Ms Angela Brusas, Director, Funding and Investor Relations, at +358 961 811 403, angela.brusas@nib.int
Mr Alexander Ruf, Director, Funding and Investor Relations, at +358 961 811 402, alexander.ruf@nib.int