In what was seen a volatile market environment (tensions in Ukraine, sanctions announced by the EU and the United States), AFD took advantage of an opportune window with more stable market conditions in order to open the orderbooks for a new trade on Wednesday, February 23rd at 09:34 CET.
The guidance was communicated at 27 basis points area above the interpolated OAT curve (FRTR 1.25 05/36 & FRTR 0.5 05/40).
The transaction was favorably received by investors, with orderbooks growing progressively throughout the morning. At 11:52 CET, the orderbooks were in excess of 900 million euros with particular interest from real-money accounts and the issuer decided to fix the spread at 27 basis points over the interpolated French curve.
Investor’s demand continued to grow following the update sent to the markets. The orderbooks were seen in excess of 990 million euros (excl. JLMs) when the issuer decided to set the size of the issuance at 750 million euros at 13:30 CET.
The transaction priced at 15:31 CET at a re-offer yield of 1.209% corresponding to a re-offer price of 98.854%, with a coupon of 1.125% and a spread of 27 basis points over the interpolated French curve.
This new issuance benefited from a solid and diversified investor base : Asset Managers took 58% of the final allocation, Insurances – 19%, Bank Treasuries – 13% and Other Investors – 1%.
Geographic distribution of the transaction reflected the AFD's visibility on the international capital markets: 43% of the trade were allocated in Germany, Austria, and Switzerland, 28% - in France, 11% - in the United Kingdom and Ireland, 7% - in Asia, 2% went to other European countries, and 1% - to the Middle East.
Thibaut Makarovsky, Head of Funding and Market Operations at AFD: “Thanks to the success of this new transaction, we have now completed nearly 30% of our financing program for the year within the first two months after having also completed benchmark issuances in US dollar and GBP. Being attentive to market conditions, we closely monitored the main developments on the euro primary market in order to position ourselves in an opportune market window despite a volatile environment. As such, we have raised an amount of €750 million at 15 years, the largest issue size attained by a French agency beyond 10 years this year.”
Details of the transaction:
- Issue expected ratings: AA (Stable) / AA (Negative) (S&P / Fitch)
- Format: Senior Unsecured, RegS Bearer Dematerialised
- Coupon: 1.125%, Fixed, Annual, ACT/ACT ICMA
- Size: € 750 million
- Pricing Date: 23 February 2022
- Settlement Date: 2 March 2022 (T+5)
- Maturity Date: 2 March 2037 (15-year)
- Re-offer Price: 98.854%
- Re-offer Yield: 1.209%
- Re-offer spread vs OAT (Over the interpolated French curve - FRTR 1.25 05/36 & FRTR 0.5 05/40): 27 bps
- Lead Managers: Barclays, BNP Paribas, Citi, Crédit Agricole CIB, Natixis
- ISIN: FR0014008SA9
- Final Orderbook Size: € 990 million (excl. JLMs)
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