BCP to raise €500M in securities

Portugal’s high street bank BCP has gone to the bonds market with a €500 million securities issue.

It will be the first operation to put new bonds on the market since BCP recovered its investment grade rating status last week from Fitch. All four main ratings agencies S&P, Moody’s, Fitch and DBRS have now returned the bank’s rating to investment grade.
According to Bloomberg, the operation is taking place today (Mon, Sept 25) with an issue of senior preferential bonds angled at investors. The amount is half a billion euros.
The bonds mature in three years with a two-year interim option. The bonus is set a 220 base points on a three year mid-swap euro rate that on Monday was trading at 3.6%. The indicative interest rate is 5.8%.
The book runners and lead underwriters for the operation were Bank of America, BNP Paribas, JP Morgan, Millennium BCP and Morgan Stanley.
Now that the bank no longer has a ‘junk’ or risky investment grade status from the ratings agencies it means BCP will be able to get financing at more favourable conditions.
BCP, the only Portuguese bank listed on the stock market, had not been rated as investment grade for 12 years since the Portuguese banking crisis. Miguel Maya, who heads the bank, told staff in a round-robin e-mail that the “implications for a listed bank that does not have an investment grade rating are relevant and diverse”.