Great reception for the Tier 2 subordinated bond issued by Unicredit: the instrument, dedicated to institutional investors for a total of 1,5 billion, has generated requests for a total of 5,5 billion, of which 1,7 billion from investors in Asia and Europe, and the rest mainly in the US and Canadian markets.
The securities have a maturity of 15 years e pay a fixed dollar coupon of 5,459% per year for the first 10 years paid on a semi-annual basis, equivalent to a spread in Euros equal to 475 basis points on the 10-year US Treasury rate. The initial guidance of 510 basis points on the 10-year US Treasury then saw an improvement of 35 basis points. The final issue spread was therefore set at T +475 basis points, equivalent to +415 basis points above the 10-year swap rate in euro.
The bonds issued by Unicredit were distributed to different categories of institutional investors mainly funds (82%), but also hedge funds (10%), insurance companies/pension funds (4%) and banks/private banks (3%). Bank of America Merrill Lynch, Citigroup, JP Morgan, HSBC, Morgan Stanley, Toronto Dominion and Unicredit Bank AG handled the placement as joint bookrunner.
The notes will be issued under the global MTN USD program and, due to the subordinated status, have the following expected ratings: Baa3 from Moody's, BB+ from S&P and BB from Fitch. The minimum denomination of the bond is $200.000 in multiples of $1.000. The settlement date is scheduled for June 30.
