Historical success – IIB for the first time reaches negative rate for its long-term funding

Historical success – IIB for the first time reaches negative rate for its long-term funding

IIB continues the series of successful funding deals this year, reaching for the first time in its 50-year-long history a negative interest rate of EUR fixed -0.05% p.a. on the after-swap basis, by placing a floating rate note amounting to RON 190 million (approx. EUR 39 million) with 2-year maturity.

The deal was placed under the IIB’s recently updated MTN Programme and will be listed on Dublin Stock Exchange. ING Bank NV, IIB’s long-term partner and one of the dealers under the MTN Programme, organized the issuance.

The issuance was placed with a floating rate of 3m ROBOR + 65 bps and had been sold to four pension funds from Romania, a clear sign that IIB is an attractive and well-known name for the Romanian investors.

“Reaching a negative interest rate for our long-term funding was a long-awaited moment for us and something we had seen as a target for quite some time now. I am happy that this year we had executed already four transactions, all very different instruments and maturities but all four extremely successful, showing a gradual improvement from one deal to another.” - noted Mr. Nikolay Kosov, Chairperson of the Management Board of IIB.

“The fact that we had broken the threshold with a RON-denominated transaction is a no surprise; we have been working consistently with our partners and institutional investors on the Romanian Debt Capital markets.Since our first issuance in the local format in 2015 we had been returning to the market often, serving the needs of the local investor community for an A-rated bonds, which is part of our development mandate. With this respect, by issuing a floating rate note in RON, IIB is filling a market gap since these type of instruments are very scarce being not issued by the Romanian Ministry of Finance for the local investor and very seldom by the corporate issuers or other MDBs.” - commented Mr. Jozef Kollár, First Deputy Chairperson of the Management Board in charge of Treasury and DCM.