BBVA has placed €1.75 billion in a 3.5-year senior preferred debt issue, maturing in November 2025. The high demand made the issuance of two tranches possible, one with a fixed coupon, of which 1.25 billion was placed, and the other at a variable rate, with a placement of 500 million.
The warm reception from investors has enabled the initial price to be reduced by 20 basis points, to a mid-swap spread plus 60 basis points in the fixed tranche. In the variable coupon tranche, the price has been set at the equivalent, three-month Euribor plus 64 basis points.
Demand was very high in both tranches. The order book in the fixed coupon tranche exceeded €2 billion, while the variable tranche received orders for €750 million.
By type of investor, for the fixed tranche, 60% of the investors were investment funds; 24%, banks and 13%, insurance companies and pension funds. For the floating tranche, 45% were banks and private banks; 40%, funds, and 13%, insurers and pension funds.
By geography, for the fixed tranche, 35% of the investors came from France; 24% from Germany and Austria; 16% of the Iberian Peninsula; 11% from the Benelux, and 7% from the UK and Ireland. For the floating tranche, 42% of the investors came from Germany and Austria; 23%, from the Iberian Peninsula; 12% from the Benelux; and 9% from France.
The underwriting banks are Barclays, BBVA, BofA Securities, Citi, Crédit Agricole CIB and Credit Suisse.
This issue is part of BBVA’s annual financing plan, which includes issuing up to €3 billion of senior preferred and non-preferred debt. The goal is to alleviate lower eligibility of instruments starting their final year of life due to MREL.
This is BBVA's second debt issue this year. In January, BBVA placed €1 billion in a senior non-preferred bond as part of its 2022 financing plan.