BCP issues €350 million in preferred bonds at 8.5%

The Portuguese bank BCP issued €350 million of preferred bonds with a three-year maturity at an interest rate of 8.5%.

The amount that had originally been envisaged was €300 million, but the bank increased it after seeing a demand of €800 million.
These bonds will reach maturity on 25 October 2025, but could be liquidated earlier after 25 October, 2024.
Up until 2024 these bonds will have a fixed coupon according to Bloomberg. If the early cash-payout option is not used in the third year, the coupon margin will be set every three months.
The bond issue was announced in the International Financing Review. The bank has declined to comment.
Commerzbank, Goldman Sachs, JP Morgan, Millennium BCP and Natixis acted as book-runners for the operation.
The bonds for this new debt issue will be admitted for trading at Euronext Dublin. The unit value for each share will be €100,000.
The issue includes the possibility of a call if the regulator does not consider the bonds eligible for MREL (Minimum Requirements for Own Funds and Eligible Liabilities).
The bank is currently executing a funding plan, with the aim of meeting the end minimum requirement of own funds and eligible liabilities, meaning a capital cushion bail-in which is a regulatory requirement. This financing plan is part of the bank’s Strategic Plan for 2021-2024.