Intesa places €1.25bn senior non-preferred green bond

(Alliance News): Intesa Sanpaolo Spa announced on Monday that it has successfully completed the placement of a senior non-preferred green bond with institutional investors for a total value of €1.25bn, recording overall demand of approximately €2.7bn.

The issuance consists of securities with an eight-year maturity and an early redemption option for the issuer after seven years, on June 22, 2033. The bonds will carry a fixed annual coupon of 3.75% until the call date.

In the event that the bank does not exercise the early redemption option, the rate will subsequently be converted to a floating rate determined on the basis of the three-month Euribor plus 88 basis points.

The transaction was priced at a level of mid-swap plus 88 basis points, significantly lower than the initial guidance of approximately mid-swap plus 120 basis points. The bank explained that the high quality and diversification of the order book allowed for a spread reduction of 32 basis points during the placement process.

According to Intesa Sanpaolo, investor interest peaked at approximately €4.3bn during the book-building phase, highlighting the market's strong appreciation for the institution's creditworthiness.

The proceeds from the issuance will be used to finance or refinance green activities that comply with the criteria defined in the group's Green, Social and Sustainability Bond framework.

By investor type, the placement was allocated 63% to fund managers, 14% to official institutions, 11% to insurance companies and pension funds, 7% to banks and private banks, and the remaining 5% to hedge funds.

From a geographical perspective, demand came primarily from France, with 24% of allocations, followed by the UK with 21%, Germany, Austria, and Switzerland with 20%, Italy with 9%, and Singapore and the Nordic countries with 8% each. Smaller shares were allocated to investors in Spain and Portugal, Greece, Benelux, and other countries.

In addition to Intesa Sanpaolo's IMI Corporate & Investment Banking Division, BBVA, JPMorgan, Natixis, Raiffeisen Bank International, Santander, and UniCredit participated in the transaction as joint bookrunners.

Intesa Sanpaolo shares closed Monday up 0.8% at €5.89 per share.

By Giuseppe Fabio Ciccomascolo, Alliance News senior reporter

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