- Proactively managing the refinancing of NBK’s US$700 million AT1 callable in April 2021 by simultaneously launching the region’s second Tender Offer on capital securities
- The only AT1 fixed income issuer in a 144A format from the MENA region
- Achieved a peak orderbook in excess of US$1.9 Billion (over 2.7x oversubscribed)
Kuwait: The National Bank of Kuwait S.A.K.P. (“NBK” or the “Bank”) successfully priced US$700 million Regulation S/Rule 144A Perpetual Non-Call 6-year Tier 1 capital securities (the “Capital Securities”) through its wholly owned DIFC prescribed company, NBK Tier 1 Limited. The Capital Securities are rated Baa3 by Moody’s, offer semi-annual coupon payments set at 3.625% per annum, and have a first reset date of 24 February 2027. The Bank simultaneously announced a tender offer on its outstanding US$700 million AT1 callable in April 2021.
The transaction achieved a peak orderbook in excess of US$1.9 billion, from more than 169 investors, translating to an oversubscription of over 2.7x. The robust demand for the Capital Securities allowed NBK to price the lowest conventional US$-denominated Basel 3 AT1 coupon by a MENA bank and the 2nd lowest US$ AT1 coupon and yield by a MENA issuer at 3.625% (Interpolated 6-Year US Treasury rate + 287.5bps). The transaction achieved a diverse final allocation lead by US investors at 30%, MENA at 27%, Europe at 23%, UK at 12%, while Asia Pacific accounts made up 8%. Asset Managers dominated the placement, making up 46%, followed by Banks and Private Banks at 28%, then Social Security Agencies, Pensions and Insurance companies at 21%, while other types of investors made up 5%.
NBK appointed Watani Investment Company K.S.C.C. “NBK Capital”, Citigroup Global Markets Limited, HSBC Bank plc, J.P. Morgan Securities plc, Standard Chartered Bank and UBS AG London Branch as Global Coordinators, Joint Bookrunners and Joint Lead Managers.
NBK Capital is a leading advisor and arranger of debt securities in the region, having advised on more than US$24 billion of global and local conventional and Islamic debt capital markets mandates and restructuring assignments to date.
The Capital Securities will further boost NBK’s capital position, reasserting the buffer on the Bank’s capital adequacy ratios, in line with its historically conservative approach towards capital management.
This is the third successful issuance by NBK in the past six months, all attracting healthy oversubscription reflecting the strong demand for NBK paper in the global markets and the Bank’s strong credit profile.
© Press Release 2021
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