International Investment Bank (IIB) recently attracted a new round of financing on the Romanian capital market, for the fifth consecutive year. The bonds, with a 3yrs maturity and a fixed interest rate of 3.98% p.a. payable annually, were listed on Thursday, November 7th, on the Bucharest Stock Exchange (BVB), under IIB22 ticker. The issue comprises 50,000 bonds, with a nominal value of RON 10,000, which means a total value of RON 500mn (EUR 105mn).
“We are proud to see the outcome of this last bond issue. It vividly demonstrates the international investor community’s confidence in the Bank’s strategic course and a sign of the Bank’s recognition as a Europe-based multilateral development institution”, stated Nikolay Kosov, the Chairperson of the IIB Management Board.
“We are glad that it has become a tradition for International Investment Bank to attract financing on the Romanian capital market and that they see a financing partner in BVB. The amounts attracted by the financial institution, together with other financing rounds carried out by other Romanian companies this year, prove that the Romanian capital market is a solid mechanism and fulfills the financing role for the issuers that prove serious and win the investors’ confidence”, said Adrian Tanase, BVB CEO.
The first financing round carried out by IIB on the Romanian capital market was in 2015, when the financial institution attracted RON 111mn, and since then the bank has issued bonds, both RON and EUR denominated, each year on the Bucharest market, reaching a total amount of almost RON 2.2bn (EUR 467mn). The first two issues have already been reimbursed by IIB.
“We created a bond with the Romanian investor base. We’ve been present on this market for 5 years in a row and this is visible in today’s outcome. We really set up benchmarks on the Romanian bond market. We issued the first euro-denominated bond listed and traded on Bucharest Stock Exchange in 2017, we repeated it in 2018 and now we have just issued the largest RON supranational/corporate bond on the local capital market achieving the lowest euro-after swap costs ever for IIB. Shareholders decisions, such as IIB headquarters relocation to Budapest, approval of a new round of capitalization, led to credit ratings and financial performance improvements. Now, we witness further positive outcomes of these decisions: the lowest costs ever for IIB obtained by its largest local currency bond issuance on the European markets so far. At the end of the day, for us, market perception and market test is the best barometer”, underlined Jozef Kollar, First Deputy Chairperson of the IIB Management Board in charge of funding and treasury.
IIB22 bonds were bought by 18 institutional investors (banks, asset managers, pension funds, insurers and mutual funds). Offshore investors represented about 12% of the issue size. Following this transaction, the Romanian capital market is currently the largest market for IIB’s debt origination (44% of the total long-term funding) and RON debt has the largest share (27%) in the breakdown by currencies.
“Romanian’s upgrade to Emerging Market status by FTSE Russell and the fact that financial institutions such as International Investment Bank or other institutions and more and more entrepreneurs look at the stock market as a complementary financing source for their businesses development plans strengthen our belief that we are on the right path in the development of this financing platform that can support the increase of the well-being of the Romanians”, said Lucian Anghel, BVB Chairman of the Board.
The issue of the bonds was carried out by BT Capital Partners, the investment banking and capital markets division of Banca Transilvania (TLV) Financial Group, together with ING Bank Romania.
“Trust and transparency are extremely important values on the capital markets. We at BT Capital Partners pride ourselves with the ability to establish lasting relationships and to enhance their results through perseverance and commitment. The outstanding results of this 5th issuance from International Investment Bank on the local market are the consequence of the hard work that began in 2015. We value greatly the time-proved partnership and we are honored to be part of this successful story”, said Daniela Secara, BT Capital Partners CEO.
“We are delighted to be one of IIB’s partners in their fifth and largest RON bond issue on the Bucharest Stock Exchange. The overwhelming interest of the local and offshore investors in this transaction set the stage for IIB to increase the size of the issue, which is a direct reflection of IIB’s strong credit quality, the solid investor base and ING’s commitment to develop the local capital markets”, said Florin Ilie, Deputy CEO, Head of Wholesale Banking, ING Bank Romania.
The funds gathered by IIB will be used to finance the existing loan portfolio and new loans granted to the Member States of the European Union and for debt refinancing.
IIB is a multilateral development institution founded in 1970, based on the Intergovernmental Agreement establishing IIB and its Charter. The nine members / shareholders of the Bank are Bulgaria, Cuba, the Czech Republic, Hungary, Mongolia, Romania, Russia, Slovakia and Vietnam.