UniCredit (Baa2/BBB+/A-) has today launched a new 10 year "lower tier 2" subordinated benchmark, with a 10 year maturity and a size of Euro 1.25 billion.
The bond pays a fixed coupon of 6.95% and has an issue/re-offer price of 99.916% consistent with a spread of 510 bps over swap rate of equivalent maturity.
UniCredit Corporate & Investment Banking, Credit Suisse and Goldman Sachs International have managed the placement acting as joint bookrunners.
The transaction has been widely distributed among institutional investors collecting orders for over 4 billion with the following allocation by investor types / regions: funds (74%), banks (15%), insurance companies (9%); UK/Ireland (28%), France (16%), Italy (13%), Germany/Austria (10%), BeNeLux (9%), Switzerland (7%).
The bond is documented under the issuer's Euro Medium Term Notes Program. In light of the subordinated status, the expected ratings are as follows Baa3 (Moody's) / BBB (S&P) / BBB+ (Fitch). The bond will be computed in the Tier 2 regulatory capital of UniCredit, contributing to the Total Capital Ratio. Listing will be on the Luxembourg Stock Exchange.
Milan, 22 October 2012