KBN successfully launches 2012 USD programme

Issuer: Kommunalbanken Norway (KBN)
Rating: Aaa/AAA
Issue amount: USD 1.25 billion
Payment Date: 8 February 2012
Coupon: 1.000% (semi-annual)
Maturity: 9 February 2015
Reoffer Price: 99.832%
Reoffer Yield: 1.057% (semi annual)
Re-offer vs. m/s: +48.0 bps
Re-offer vs. Benchmark: UST 0.125% January 2015 +75.1bps
Lead Manager: Deutsche Bank, J.P. Morgan, Nomura and UBS

The transaction was mandated on Tuesday afternoon, following a strong and constructive re-opening of the market post Chinese New Year. The mandate was announced London afternoon to ensure all three major time zones had time to look at the transaction.

With strong overnight feedback and robust interest from the US, the guidance was improved to mid-swaps +50 bps from an original whisper of low/mid 50s. The transaction launched at 8.15am Wednesday morning with strong momentum behind the book and had to be closed on an accelerated timetable as books were in excess of USD 2.5bn after less than 2 hours.

The deal was intended to be capped at US$ 1bn but the number and calibre of orders led to a US$ 1.25bn print, the strength of the book necessitated a further tightening in price to mid-swaps +48bps but still paying an attractive pickup of 75.1bps over the 0.125% January 2015 UST.

KBN enjoyed granular distribution with more than 60 investors participating; post allocation the orderbook was well balanced with US 36.6%, Asia & Middle East/Africa 28.4%, Europe 21.2% and Americas - ex US 13.8%.

Central Banks and Official Institution participation in KBN was a record high at 66.5% reflecting the safe-haven draw of the name. The remainder was split amongst Banks 11.0%, Corporates 10.5%, Insurance & Pension 6.5% and Asset & Fund Managers 5.5%.

For further information, kindly contact: funding@kbn.org