Handelsbanken £400m completes UK hat-trick

Nov 21st, 2013

Svenska Handelsbanken made its third visit to the sterling market this year with a £400m (Eu477m, Skr4.27bn) seven year senior unsecured deal on Thursday of last week (14 November).

The deal comes after a £250m four year for the Swedish bank in August and a £400m three year floating rate note at the end of April.

A syndicate official at one of the leads — JP Morgan, Lloyds and Nomura — said they had some lead interest in the name in seven years, partly coming in after Handelsbanken’s four year.

“We felt that there was good demand in this part of the curve and for this type of issuer, namely a double-A credit,” he added.

IBM was readying a seven year deal the same day and he said that they waited until this was in the market before deciding to proceed with Handelsbanken’s deal after judging that the competing supply would not have a negative impact.

The leads then went out with IPTs of the 110bp over Gilts area, with the syndicate official saying that this compared with fair value being seen in the low 100s given where comparables were trading pre-announcement. Around £750m of orders came in from more than 80 accounts after books were officially opened with guidance of the 105bp area, and the deal was priced at 105bp.

“We felt that was the right size for this particular market and that the book supported it, with pure real money demand,” said the syndicate official.

He said that some of these investors looked to top up their allocations in the aftermarket. Demand was mostly from the UK and Asia, he added, with other European investors also involved, from Germany, Ireland and elsewhere.

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