UniCredit has launched today a new 10 year OBG benchmark for a Euro 1 billion confirming the broad market access for the Group, and proving the strength of the OBG asset class.
The deal has encountered a positive response from institutional investors, allowing to reach the target size thanks to a final order-book well above Euro 1.1 billion, with the involvement of 50 prominent European investors, representing one of the largest capital market transactions recently executed.
The bond will pay a coupon equal to 5%, and has an issue price of 99.72%, resulting in a yield equivalent to 215 basis points above the swap curve. Such spread, at time of launch, is in line with the BTP of corresponding maturity, and as such represents the tightest OBG pricing ever reached versus the reference government curve.
The new issue (expected to be rated AAA/Aaa/AAA by Fitch, Moody's and S&P) was managed by UniCredit Corporate & Investment Banking together with BNP, HSBC, SG and UBS and has been distributed predominantly to asset managers (61%) and central banks (20%) in Europe. The geographic distribution of the accounts involved in the deal has been dominated by Germany (41%) followed by Nordic countries (20%), Italy (18%) and France (12%).
The issue launched today is part of the 20 billion Euro Programme announced in 2008 and based on a portfolio entirely composed by residential mortgages. For the benefit of the OBG holders (up to date 10 billion Euro issued including the present issue), the bank has already segregated around 13.2 billion Euro of residential mortgages originated by UniCredit S.p.A..
The global portfolio as of end of June 2011 comprises approximately 121,000 mortgages and has a very high granularity (with an average outstanding amount lower than Euro 106.000). It has an average loan-to-value of approx 61%, a geographical concentration in northern and central Italy of 55% and 23% respectively. The Programme has been arranged by UniCredit Corporate & Investment Banking.
Milan, 25th August 2011
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