Investor demand was very strong from the outset. The high quality, well diversified and granular investor demand allowed MuniFin to tighten the guidance by 4bps with little price sensitivity. 75 minutes after the announcement books closed in excess of EUR 1.9 billion.

In total, 76 investors participated in the transaction. The order book was dominated by investors from Germany (44.1%) and France (14.4%), followed by the Swiss (8.9%), Nordics (7.8%), Benelux (6.9%), the rest of Europe (6.1%), Asia (6.0%), the UK (5.7%) and the Middle East (0.1%).

Central Banks & Official Institutions (39.6%) represented the largest share of allocations, followed by Asset Manager (20.3%), Insurance companies & Pension Funds (20.0%) and Banks (17.8%).

“We are extremely happy with the strong result. We started issuing EUR benchmark notes in 2016 and have been able to build up a liquid curve, which now consists of four reference points. It is very nice to see that there is strong demand for high-quality issuers like MuniFin. In addition, this is the longest benchmark we have issued”, says Joakim Holmström, Head of Funding.

“With this bond, MuniFin successfully extended their EUR curve. After a warmly welcomed EUR green bond last year, the strong and well oversubscribed book showed that EUR investors are also extremely interested in MuniFin’s longer dated paper”, says Crispijn Kooijmans, Head of Public Sector Bond Origination at Rabobank, who acted as a joint lead manager in the transaction.

Details of the transaction:

Issue Size:                                     EUR 500 million

Payment Date:                            23 January 2018

Maturity Date:                            23 February 2033

Coupon:                                         1.250 % Fixed coupon

Re-offer Price:                            99.905 %

Re-offer Yield:                            1.257 %

Re-offer vs Mid Swaps:           – 4 bps

Lead Managers:                          Barclays, Citi, Rabobank, SG CIB

More information:

Joakim Holmström, Head of Funding

joakim.holmstrom(at)munifin.fi

+358 50 444 3638

MuniFin took advantage of the strong market backdrop followed by last week’s strong US nonfarm payrolls.

The transaction was priced at mid-swaps + 7 basis points and spread versus the 3-year US Treasury was 30.05 basis points. The price guidance was tightened by two basis points from initial price thoughts to pricing from mid-swaps +9 to mid-swaps +7 due to strong investor demand. The final orderbook stood in excess of USD 1.85bn, which is considerable for a USD 1 billion no-grow transaction. The maturity date of the transaction is September 18th, 2020. The transaction pays a semi-annual coupon of 1.875 percent and has an issue price of 99.992 percent.

The benchmark attracted strong interest from investors. The largest take up was from central banks and official institutions with 55 percent. Banks were also a significant investor group with 31 percent. Asset managers bought 14 percent of the transaction. Europe and the Middle East represented 44 percent of the book and 42 percent was sold to Asian investors. Americas participated with 14 percent.

More information:

Esa Kallio, Deputy to the CEO, Head of Capital Markets, tel: +358 9 6803 6231

Joakim Holmström, Head of Funding, tel: +358 9 6803 5674

Taking advantage of a strong market backdrop with good investor demand supported by a backup in yields, MuniFin priced its first USD benchmark of the year, extending its USD curve to the company’s longest benchmark reference point, reaching 2022.

The transaction has a final maturity of 15 March 2022, pays a semi-annual coupon of 2.375% and has an issue price of 99.584%. The deal was priced at +29bps versus mid-swaps, tightened from the initial guidance of mid-swaps +30 area on the back of a strong oversubscribed order book, with a book size of more than USD 1,5 billion.  This equates to a spread of +37.25bps over the US Treasury 1.875% due February 2022. 

BMO Capital Markets, J.P. Morgan, Mizuho and Morgan Stanley acted as joint lead managers.

The orders reflect the high quality of investor interest in MuniFin’s credit, with banks taking the largest share (50%), followed by central banks and official institutions (34%) and asset managers (16%). Interest was well balanced: EMEA took the largest share accounting for 43%, with the remainder spread between the Americas (25%), Asia (22%) and Nordics (10%). 

The 10-year benchmark loan was priced at mid swaps +1 basis point and it has a coupon interest of 0.625 %.  

This benchmark bond was only MuniFin’s second benchmark outing in euros as the majority of previous benchmark issuance has been in US dollars. The euro benchmark was part of MuniFin’s strategy of expanding its investor base. The investor demand was particularly strong out of Germany, representing 35 percent of the allocations. Bank treasuries were the largest investor group taking 60 percent of the issue.

The lead managers of the benchmark were Barclays, Citigroup, J.P. Morgan and Nomura.

CMD Portal is a British market data provider. The award winners are selected based on the opinions of market participants, league table statistics and interviews with market operators. Dozens of issuers are nominated as recipient candidates for this annual award.

MuniFin is a well-known structured note issuer and issues a significant amount of its annual funding in structured format, mainly in Asia. The cornerstones of MuniFin’s funding are flexibility and an investor driven focus.

– We highly appreciate being recognized with this award and we are delighted that our efforts in the structured note space are acknowledged again. The issuance of structured notes has been a strategic decision to diversify our funding sources and be able to cater to a wide range of investors, comments Joakim Holmström, Head of Funding at MuniFin.

Further information:

The order book exceeded USD 1.9 billion and there were orders from nearly 50 accounts. 70 % of the transaction was sold to Central Banks and Official Institutions, 17 % to Bank Treasuries and 13 % to Asset Managers. EMEA was the dominant area with a 55 % share, Americas and Asia Pacific accounted for 35 % and 10%, respectively.

MuniFin plans to issue EUR 6.5bn in 2016 and after the completion of this transaction MuniFin is almost 80 % complete for the year.

More information:

Esa Kallio, Deputy to the CEO, Head of Capital Markets tel. +358 9 6803 6231

Joakim Holmström, Head of Funding tel. +358 9 6803 5674

– Being included in the list of agencies whose securities are eligible for purchase programmes further improves our already strong position in the international bond markets. This strengthens the  secondary market position of MuniFin’s public euro bonds particularly in cases of market disturbances, says Esa Kallio, Executive Vice President, Head of Capital Markets, MuniFin.

The Governing Council of the European Central Bank (ECB) decided on 2 June 2016 to add MuniFin to the list of agencies located in the euro area whose securities are eligible for the public sector purchase programme (PSPP).

See list of issuers included in the ECB’s public sector purchase programmes >

MuniFin has been a runner-up before in the same category but this is the first time the company takes the first spot. This time the runner-up positions were taken by the World Bank and KfW.

– We are very delighted to receive this exclusive award. We know that we are competing with a distinguished group of issuers in the MTN space, and to be selected the Most Impressive of them is a huge honor. The fact that this award is selected through a voting process by market participants makes it even more special, says Joakim Holmström, Head of Funding at MuniFin.

– This recognition shows that we as an institution are focusing on areas the markets appreciate, such as responsiveness and flexibility, Holmström continues.

FURTHER INFORMATION >

On March 15, 2016 MuniFin issued a 1bn euro benchmark maturing in October 2021.  The transaction was MuniFin’s first euro benchmark in 13 years.

The coupon was fixed at a record low 0.1 percent with a re-offer yield of 0.122 percent. Despite the tight pricing, the benchmark was very attractive, with books closing in excess of EUR 1.6 billion.

The book was very granular with over 50 accounts participating from more than 15 jurisdictions. The demand was greatest in Europe, especially in Germany (20 %), France (16 %), the Nordics (15 %) and Benelux countries (9 %) and outside Europe in the Middle East (17.5 %) and Asia (10 %). The most important investor type that participated in the transaction were banks with a 50 per cent share, central banks and official institutions adding up to 38 per cent of the allocation. The share of asset managers and insurance and pension funds was 12 per cent.

– MuniFin’s mission is to ensure the availability of competitive financing for Finland’s municipal sector and government-subsidised housing production under all market conditions. To fulfil this, we actively strive to diversify our funding in different markets. We have consistently been building an investor base for example in the USD markets. With our growing funding needs, we also wanted to offer our investors a euro benchmark, says Executive Vice President Esa Kallio at MuniFin.

The lead managers were Barclays, Danske Bank, J.P. Morgan and Société Générale.

– The basis of MuniFin’s operations on the international capital markets are its stable and high credit rating. The investors also value MuniFin’s active investor relations work. These factors combined with the issuer’s ability to act fast in the markets were crucial for the benchmark’s success, says Samu Slotte, Head of DCM Finland at Danske Bank.

Further information:

Esa Kallio, Executive Vice President, MuniFin, tel. +358 50 3377 953 
Joakim Holmström, Vice President and Head of Funding, MuniFin, tel. +358 50 4443 638
Samu Slotte, Head of DCM Finland, Danske Bank, +358 50 68 924

Mtn-i, a British market data provider, awarded MuniFin the Agency Issuer of the Year 2015  award in its award ceremony on February 11, 2016.

– Being recognized as the best Agency Issuer is a significant achievement for us. SSA issuers have attractive investment opportunities to offer in the international capital markets, and the amount of active issuers is large. We have been building a strong presence in several markets and put a lot of effort into developing investor relations and a flexible product offering. The mtn-i award is a recognition for this work, says Esa Kallio, Senior Vice President and the Head of Capital Markets at MuniFin.

Earlier in December 2015 Capital Market Daily (CDM) chose MuniFin as the Best Structured Note Issuer and the Best Uridashi Bond Issuer.

MuniFin was in very good company; the only other winners besides MuniFin in the awards CMD Portal organizes in several categories were the German development bank KfW and the World Bank Group subsidiary IFC. The Best Issuers chosen by mtn-i were MuniFin, the World Bank, the Dutch ABN AMRO bank and energy giant Engie.

Further information:

mtn-i 2016 award winners

CMD 2016 Issuer Awards