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Sunday, 14th April 2024
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€1.5 bn programme for IIB Back  
First medium-term note programme for IIB Bank.
IIB Bank, a wholly owned subsidiary of Belgium-based KBC Bank, has launched a E1.5 billion medium-term note programme to further strengthen the funding base of the bank. The programme was structured by IIB Bank’s treasury/capital markets division and Merrill Lynch, and has received a P1 rating from Moody’s.

Standard & Poor’s gave the program an A1 rating with senior unsecured debt with a maturity of more than one year receiving an ‘A’ rating; senior unsecured debt with a maturity of less than one year receiving an ‘A-1’ rating; dated subordinate notes receiving an ‘A-1’ rating; and undated subordinated notes receiving a ‘BBB+’ rating.
The paper will be placed primarily with investors throughout Europe using a network of dealers including KBC, Deutsche Bank, JP Morgan, Lehman Brothers and Merrill Lynch.

IIB, a wholesale bank focuses on providing lending, treasury and asset finance products to the Irish corporate sector. It also offers residential mortgages through IIB Homeloans and had total assets of E7.3 billion at the end of 2001.

To date, most of Ireland’s leading financial institutions have issued MTN programmes. Some of the issues are as follows: Bank of Ireland issued a E8 billion programme of senior unsecured subordinated notes in 1995, Allied Irish Bank issued a E5 billion programme of senior unsecured subordinated notes in 1993, Irish Life & Permanent issued a E5 billion programme of senior unsecured subordinated notes in 1999, Anglo Irish Bank issued a E2 billion programme in 2001 and Ulster Bank issued a $1.25 billion medium-term note programme of senior unsecured notes in 1996.

The euro medium tern note (EMTN) market has grown strongly in recent years and financial institutions have begun to move away from traditional instruments such as commercial paper, which typically have a maturity of three to six months. Medium term notes have a maturity of up to five years and a typical ‘life’ of two to three years and are offered continuously rather than all at once as a bond issue is. For institutions borrowing in this market, access to funds of this maturity strengthens capacity for growth in lending activities and helps diversify the funding base.

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