AIB raises €500m in bond sale
AIB made its second foray into the bond markets in as many months today when it raised €500 million in a three-and-a-half year secured covered bond issue.
The transaction marks the second time that the bank has issued a bond backed by Irish mortgages, and without the assistance of a state guarantee, since 2007.
The transaction was part of the bank’s €20 billion mortgage covered securities programme, and was issued by AIB Mortgage Bank, a wholly owned subsidiary of AIB.
According to the bank, the deal was priced at a spread over mid-swaps of 185 basis points and was over-subscribed more than four times. The total order book was about €2.2 billion with in excess of 160 international investors, “reflecting a well placed and diversified profile”. Demand came from 20 countries with 99 per cent placed outside Ireland.
“This transaction demonstrates the continued progress of AIB's strategy of engaging with the market in a balanced and measured manner,” the bank said in a statement to the stock exchange.