Swedbank makes first senior unsecured bond issue under the Swedish State’s guarantee scheme. A total of 2000 m has been raised, the bond is denominated in EUR. The rate was set to 3.625% which corresponds to about 35 bp above mid swap ().
The transaction is priced somewhat higher than bonds under the British government’s guarantee. The difference reflects the CDS spread between the sovereigns. The price level, including the fee to the Swedish state of 83 bp, is substantially bellow indicative non-guaranteed level.
As of December 2007 Swedbank had total assets of SEK 1,600 billion and approximately 22,000 employees. The group has 9 million retail customers and 600,000 corporate customers with more than 459 branches in Sweden, 300 branches in the Baltic countries and another 190 branches in Ukraine.
A successful transaction and the interest from investors has been high, says Mikael Edler, head of Treasury, Swedbank. We have not seen any public senior unsecured bond issues from Swedish banks in the international market since mid September. It is currently very hard to raise this kind of funding without a state guarantee.
L.D.