ENBD $1bn bond draws strong investor demand

Emirates NBD (ENBD) has priced a $1 billion five-year senior unsecured bond at the tight end of its final pricing guidance, a document from lead managers said on Wednesday, as heavy investor demand helped it secure a better borrowing rate.

Dubai's largest lender completed the deal at a spread of 150 basis points over midswaps, the tight end of the 150 bps to 155 bps guidance indicated earlier on Wednesday.

This, in turn, was inside initial price thoughts in the area of 165 bps over the same benchmark given on Tuesday.

Pricing of the bond tightened on high investor demand, with orders topping $3 billion, according to the arrangers.

This allowed the deal to price without any new issue premium over its existing bonds, according to two Gulf-based bankers away from the deal, who spoke on condition of anonymity as they weren't authorised to talk to media.

New issue premium is the additional margin which a borrower usually has to offer to incentivise investors to buy the new issue over its previous bonds.

The deal, rated Baa1 by Moody's and A plus by Fitch, carries a coupon of 3.25 percent and comes with a reoffer price of 99.963, the document showed.

Bank of America-Merrill Lynch, BNP Paribas , HSBC, Standard Chartered and ENBD's own investment bankers arranged the bond sale.

It is the first time since March 2012 that the bank has issued a senior unsecured bond denominated in dollars.

In that time, it has completed the sale of two capital-boosting bonds in the currency - the latest being a $500 million issue in September - while it has also printed deals in other denominations, such as New Zealand dollars.  

 

Follow Emirates 24|7 on Google News.