CEB issues a GBP 500 million five-year benchmark

PARIS - On Thursday 7th September 2017, Council of Europe Development Bank (CEB), rated Aa1 (stable) / AA+ (positive) / AA+ (stable), successfully priced a new GBP 500mn benchmark due June 2022. Barclays, RBC Capital Markets and TD Securities were joint lead managers on the transaction.

Taking advantage of the attractive conditions in the Sterling market, CEB announced the mandate for a new GBP Jun-22 RegS benchmark at 1.30pm London time on Wednesday 6th September 2017, along with initial price thoughts (IPT) of UKT 4% Mar-22 +42bps area. Indications of interest grew steadily through the London afternoon with early interest coming predominantly from European bank treasury accounts. Books formally opened the following morning with a guidance of Gilts+42bps area, in line with the IPT level and with already indications of interest in excess of GBP 250mn.

The orderbook continued to grow, reaching in excess 450mn after 2 hours of book building at which point, thanks to the high quality of the orderbook, the spread was set at Gilts +41bps. Several significant orders came in after the update on size and spreads before books closed at 10.30am London with the final size announced as GBP 500mn - which marks the largest ever GBP new issue for CEB. The final size of the orderbook was GBP 625mn from over 30 accounts. This was effectively the largest ever book for a CEB GBP benchmark.

The transaction was priced shortly after at 12.30 London with an annual coupon of 0.625% and a reoffer price of 99.580%, equating to a reoffer yield of 0.714%.

In terms of distribution, by investor type, Banks took 64%, Fund Managers and Insurance 26%, Central Banks and Official Institutions 7% and Corporates 3%. By region, UK took 84% while EMEA excluding UK took the remaining 16%.

Investor breakdown

By investor type
Banks: 64
Fund Manager / Insurance: 26
CB / OI: 7
Corporates: 3

By region
UK: 84
EMEA (excl UK): 16