NIBC successfully launches second conditional pass

1 April 2014, NIBC Bank announced the successful launch of its second EUR 500 million conditional pass through covered bond. The issue followed the inaugural and innovative EUR 500 million transaction of October 2013, that gained worldwide recognition and won the IFR Covered Bond of the Year Award.

The conditional pass through covered bond differs from existing bonds, due to the absence of derivatives and inclusion of an orderly wind-down mechanism subject to strict conditions. NIBC’s conditional pass through covered bond program is Dutch law based and backed by a pool of Dutch residential mortgage loans. The program is registered with the Dutch Central Bank and benefits from a favourable regulatory treatment. These features create more stability in ratings and structure.

The bonds are expected to be rated AAA by both Fitch and S&P. The deal was three times oversubscribed with an order book of around EUR 1.5 billion, underlining the interest shown by institutional investors from among others Germany, the Netherlands, the United Kingdom, France and the Nordic countries. The interest followed an extensive roadshow across Europe over the past two weeks with support of the syndicate banks consisting of JP Morgan, LBBW, NIBC, RBS and Société Generale. The transaction was launched and priced in one day, at an attractive spread of mid swaps +33.

With this transaction, NIBC once again shows its expertise and capability in structuring products that meet today’s investor demands.