Today, Banco Sabadell placed Euros 1.2 billion in 3-year mortgage covered bonds (cédulashipotecarias) in less than four hours. The bank's solvency and institutional investors' perception of its solid track record undoubtedly contributed to the success of this accelerated placement.
The issue, aimed at institutional investors, both domestic and international, was initially intended to total Euros 500 million. However, demand was strong from the outset and the issue was expanded to Euros 1.2 billion, 140% more than the initial target.
The bonds pay a coupon of 3.625%, i.e. 250 basis points over mid-swap.
The issue, which will be settled on 16 February, forms part of Banco Sabadell's programme of non-equity securities that is registered with the Spanish National Securities Market Commission (CNMV).
With Banco Sabadell, Deutsche Bank AG, Merrill Lynch International, Nomura International Plc and Natixis as bookrunners, the issue attracted a high level of participation by international investors, who accounted for 42% of the total. The response from European investors was particularly notable: Germany and Austria each accounted for 11%, France for 9.3% and Italy for 6.3%.
The investors were principally financial institutions, central banks, fund managers, insurance companies and pension funds.
