AFD Launches USD 1.5 Billion 1.375% Regs Benchmark Transaction Due 21 January 2025

On Wednesday 12th January 2022, Agence Française de Développement (AFD), rated AA (S&P)/AA (Fitch) priced a new USD 1.5 billion fixed rate 3-year transaction due 21st January 2025.

Aspects of the transaction:

AFD’s first syndicated benchmark transaction of the year is marked by a strong return to the 3-year tenor in USD. The transaction gathered a well-diversified and granular orderbook despite volatile market conditions.

This USD 1.5 billion transaction offered a spread of SOFR MS +23bps equating to a re-offer yield and price at 1.385% (ann.) / 99.972%.

The joint lead managers on this transaction were BNP Paribas, Citi, Goldman Sachs, J.P. Morgan and Société Générale.

Execution and Placement:

The new benchmark was announced at 13:50pm (Paris Time) on Tuesday 11th January with initial price thoughts released at SOFR MS+24bps area.

The orderbook officially opened on Wednesday morning at 08:53am (Paris time) with indications of interest in excess of USD 1.2 billion (incl. USD 150m Joint-Lead managers orders) enabling to release the price guidance at SOFR MS+24bps area.

At 11:38am (Paris time), AFD fixed the spread at SOFR MS+23bps on the back of a large orderbook in excess of USD 1.5 billion (incl. USD 150m Joint-lead managers orders).

The orderbook continued to grow steadily and eventually closed in excess of USD 1.9 billion (incl. USD 150m Joint-lead Managers orders). Final terms were announced at 15:37pm (Paris time) with the final size set at USD 1.5 billion.

The transaction priced at 17:23pm (Paris time) with a coupon of 1.375%, a re-offer yield of 1.385% (ann.), equivalent to a spread of +17.1bps vs UST 1.125% 15/01/2025.
CBs / OI’s demand dominated the allocations (83%) followed by banks (12%). The majority of the demand came from the Americas (39%) followed by Asia (28%), Europe (25%) and MEA (8%).

Diane Menville, Head of Treasury and Capital Market: “We are very pleased to launch our 2022 funding program with this USD transaction, gathering top quality investors and marking AFD’s return on the 3-year maturity. We may come back on the USD market later during the year and will communicate soon about our 2022 funding needs.”

Transaction summary:

Issuer: Agence Francaise de Developpement (AFD)
Issuer ratings: AA/AA (Stable/Negative) S&P/Fitch
Amount: USD 1.5 billion
Settlement date: 21st January 2022 (T+5)
Maturity date: 21st January 2025 (3-year)
Issue price: 99.972%
Coupon: 1.375%, annual, 30/360
Re-offer yield: 1.385% (ann.)
Re-offer spread vs SOFR MS: +23bps
Denomination: USD 200k / USD 200K
Listing: Euronext Paris, French Law
Joint-Lead Managers: BNP Paribas, Citi, Goldman Sachs, J.P. Morgan, Société Générale