MuniFin, rated AA+, made history with its fifth benchmark of the year. The green 5-year benchmark garnered an astonishing USD 5.5 billion order book, representing the largest one ever for MuniFin.
On Tuesday, 1 October, MuniFin announced a mandate for a new USD 1 billion (no-grow) green bond with initial price thoughts in the MS+50 bps area. The demand was exceptionally strong from the outset, and the spread was tightened twice by 2 bps the following morning, setting it at +46 bps.
The books eventually closed above USD 5.5 billion, setting a record for MuniFin.
“We are excited to return to the green USD market with a 1 billion benchmark, reflecting the continuous growth of our green finance portfolio. The strong investor demand reaffirms the USD market’s strength. Thank you to our investors and joint lead managers for making this happen”, says MuniFin’s Senior Analyst Aaro Koski.
“Congratulations to the MuniFin team on a well-timed and executed USD green transaction. The depth and diversity of the order book are a testament to MuniFin’s global appeal and longstanding conventional and ESG investor bases. We are delighted to have supported them on this exercise”, said Adrien de Naurois, Joint Lead Manager on the transaction from BofA Securities.
Investor demand was driven by good-quality accounts. Central banks and official institutions took 61% of the allocations, bank treasuries took 25%, and the remaining 14% went to fund managers and insurance or pension funds. Geographically, the distribution was well diversified across EMEA (Europe, the Middle East and Africa), the Americas and Asia.
MuniFin has now completed approximately EUR 8 billion out of its 9 billion long-term funding target for the year.
Transaction details
Final terms, 2nd October 2024
Issuer | Municipality Finance Plc (“MuniFin”) |
Issue rating | Aa1 / AA+ (Moody’s / S&P) (all stable) |
Issue amount | USD 1,000,000,000.00 |
Pricing date | 2nd October 2024 |
Settlement date | 9th October 2024 (T+5) |
Maturity date | 9th October 2029 |
Re-offer price / yield | 99.557% / 3.723% |
Coupon | 3.625% (semi-annual) |
Re-offer spread | Mid-swaps +46bps |
Spread vs benchmark | UST 3.5% Due September 2029 +16.1bps |
ISIN | XS2914674408 / US62628PAG19 |
Joint lead managers | BofA Securities, Nomura, RBC Capital Markets, TD Global Finance |
Distribution by type
Distribution by region
Comments from joint lead managers
“Municipality Finance (MuniFin) returned to the USD market with a bang, extending their curve out to Oct-2029s. The $1bn no-grow 5-year garnered a $5.5bn book, utilising their Green assets for the transaction, their first time in the USD market for 8 years. The transaction witnessed phenomenal traction and provided USD investors the rare opportunity to engage in a Munifin Green Bond. The result is a testament to Munifin’s credit quality and standing with the global investor base. Congratulations!”
Mark Yeomans, Managing Director, Public Sector DCM, Nomura
Congratulations to the MuniFin team on a very successful USD 5-Year Green transaction; reacting swiftly to print their first USD Green Benchmark since 2016. The final orderbook in excess of $5.5bn marks MuniFin’s record for a USD transaction; a reflection of the high-quality credit and a recognition of the team’s efforts on global investor engagement. RBC was delighted to be involved and it was a pleasure working with the team on this transaction.”
James Taunton, Head of Public Sector Origination, Europe, RBC
“Congratulations to the MuniFin team on an outstanding result with their 5yr USD Green transaction. The team managed to take advantage of robust execution conditions in the USD market and pick an excellent execution window resulting in a phenomenal outcome!”
Laura Quinn, Managing Director, Global Co-Head of SSA and Head of Dublin Debt Capital Markets, TD Global Finance