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Luminor completes its inaugural hybrid capital security, a €150m Perpetual Additional Tier 1 note.
The offer was oversubscribed quickly with over €825m of interest from more than 140 investors located across 25 countries. The size, quality, and diversity of the orders enabled Luminor to price the security later the same day at a spread of 526 basis points over mid-swaps, with a coupon of 7.375%. The notes saw good demand from investors across Europe, notably from the UK, France and Benelux, and Italy and Iberia, supplemented by interest from investors in the United States and Asia.
Luminor announced the issue on Wednesday 5 February.
The notes, which are obligations of Luminor Holding, the parent company of Luminor Bank, are callable during a 6-month period ending six and a half years after issuance, and are rated Ba2 by Moody’s. The notes are listed on the Global Exchange Market of Euronext Dublin and were issued under a standalone Offering Circular. Citigroup and Morgan Stanley were joint bookrunners, and Luminor Bank a co-manager, for the transaction.
Johannes Proksch, Luminor’s Chief Financial Officer, commented: “I am delighted with the interest we received from investors in our initial hybrid capital security issue. Their commitment demonstrates the attractiveness of investing in the Baltic countries and Luminor. The issue of these notes extends our liability structure, increases the efficiency of our capital, and builds our investor base.”