Cyprus' Bank of Cyprus concludes successful offering of €300 million in Tier 2 bonds.
Bank of Cyprus, the issuer, has successfully priced new €300 million Tier 2 Capital Notes, with the proceedings set to strengthen the bank's financial position. The issue, which took place under the €4 billion Euro Medium Term Note Programme, was co-ordinated and structurally advised by BofA Securities and Goldman Sachs, while CISCO acted as Co-Manager.
The new Tier 2 Notes, rated Ba1 by Moody's, will mature on 18 September 2036. They will be issued at 99.632% and offer a coupon of 4.25%, with a yield of 4.321%. Interest on the Notes will be payable annually in arrears and reset on 18 September 2031.
Proceeds from the issue will be loaned by BOC Holdings to Bank of Cyprus, significantly improving the Group's Total Capital Adequacy Ratio by approximately 300 basis points. The new Tier 2 Notes will be traded on the Euro MTF market of the Luxembourg Stock Exchange.
Barclays, Citigroup, and Morgan Stanley served as Joint Lead Managers for the issue, and the order book exceeded €3 billion, more than 10 times the target size. Final pricing was set at a spread of 195 basis points.
In a separate development, an offer has been launched by the Company to repurchase existing €300 million Tier 2 Notes due 2026 at 102.3% of par value. This move is expected to further enhance Bank of Cyprus's capital structure.
Despite extensive search results, information about who arranged the new capital bonds at Bank of Cyprus could not be found. This news marks a significant step forward for Bank of Cyprus, as it continues to strengthen its financial position and navigate the ever-changing financial landscape.
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