First Gulf Bank has concluded issuance of 250 Australian dollar for Kangaroo bond

Wednesday, Apr 02, 2014

Abu Dhabi: First Gulf Bank (FGB) has concluded the issuance of 250 million Australian dollars ($228.35 million, Dh850 million) for its debut “Kangaroo” 5-year bond. The transaction took place on March 24th, registering a final price for the bonds at 155 basis points above interpolated midswaps (bps). The bonds are set to mature on April 1, 2019.

The bonds have a long-term rating of A+ by Fitch and A2 by Moody’s, considered for both and are listed with coupons at a fixed interest rate of 5 per cent p.a.

FGB’s bonds have received highly positive endorsement from global investors with a total demand of A$375 million. The book was driven by broad demand across many regions, with final allocations of 41 per cent to domestic Australian investors, 31 per cent to Asian investors and 29 per cent to European investors. In terms of allocation by investor type, 55 per cent of bonds went to Institutional investors and Fund Managers, 28 per cent to Banks and 16 per cent to Private Banks.

Feedback

Commenting on the transaction, André Sayegh, CEO of First Gulf Bank, said: “Our first issuance in the Australian market has proven to be very successful, with a high level of interest displayed by international investors. We are very pleased with the feedback received, and with our entry into a new market, which complements our strategy of expanding our operations internationally and of diversifying our sources of funding. We are also proud of having achieved our lowest pricing on a public issuance.”

The transaction was jointly led by ANZ, HSBC and Nomura. Proceeds from these bonds will be used by FGB for general funding purposes.

Staff Report