Thursday, February 22, 2024

A&O, Clifford advise on Caixabank´s €750m AT1 issue

Allen & Overy has advised the joint lead managers on the issuance of AT1 preferred securities by CaixaBank, counselled by Clifford Chance, for a value of €750 million.


CaixaBank has launched its fifth issue of preferred secutities convertible into shares for €750 million with a coupon of 8.25%, equivalent to mid-swap + 514.2 bps, one level below the weighted average of CaixaBank’s AT1 issues, at mid-swap + 539 bps. The previous AT1 issue was made in September 2021. This is CaixaBank’s third debt issue in 2023 following the issuance of senior non-preferred debt in dollars and subordinated debt in sterlin in January.

These preferred shares are perpetual, with the possibility of early redemption of the issuer as of March 2029, allowing CaixaBank to extend the refinancing profile of its AT1 instruments.

The issue’s success is reflected in the demand, which exceeded €2,500 million (more than 3.3 times oversubscribed) and enabled the price to be reduced by 37.5 bps, from the level offered at the launch of the operation, to a final coupon of 8.25%.

More than 170 institutional investors participated in the transaction, underscoring the consolidated capillarity of CaixaBank’s investor base.

This new issue reinforces CaixaBank’s excellent solvency ratios, to 15.1% and 18.0% Tier 1 and Total Capital respectively, maintains flexibility in the management of the AT1 issuance buffer, while helping to maintain its solid leverage ratio of 5.7%, above the 3.0% requirement and increasing the anti-crisis buffer (MREL) to 27.1%, extending the support of senior creditors.

Standard & Poor’s has assigned a rating of BB to this issue. The underwriters were Barclays, CaixaBank, Goldman Sachs Bank Europe SE, J.P. Morgan SE and UBS Investment Bank.

The Allen & Overy Spain´s team involved in the transaction comprised partners Salvador N. Ruiz Bachs and Charles Poole-Warren, senior associate Álvaro Rojo Santos and associate Lázaro García Domínguez.

Yolanda Azanza (left), Francisco Pizarro (top right) and Mariana Ceballos (bottom right)

Clifford Chance advised CaixaBank with a Capital Markets team led by partner Yolanda Azanza, who was supported by senior associate Francisco Pizarro and junior associate Mariana Ceballos.

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