Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:


KfW´s largest 10y USD Global due to Exceptional Demand

On Wednesday KfW has priced its second USD benchmark issue in 2010. The bond with a maturity of 10 years has a volume of USD 4 billion, making it the largest 10y USD Global ever by an Agency from Europe.

With this transaction, KfW has responded nimbly to both the current yield environment and strong investor demand for top-quality longer-dated assets in an environment of limited supply.

Dr. Günther Bräunig, member of the Managing Board of KfW Bankengruppe and in charge of capital markets commented: "It is not only the largest but probably the most successful 10 year USD-bond we have ever issued. We never had such tremendous interest from large international investors before."

Settlement date of the bond is January 27th 2010 and it will mature on January 27th 2020. With a coupon of 4% p.a. and a reoffer price of 99.657% it yields 4.042% semi-annually. This corresponds to a yield pick-up of 38.5 basis points over the current ten-year US Treasury with maturity November 2019. The bond has an AAA/Aaa/AAA rating from Fitch Ratings, Moody's and Standard & Poor's as all KfW bonds have. Lead manager of the transaction are Goldman Sachs, JP Morgan und UBS; Co-Lead Managers are Bank of America / Merrill Lynch, Barclays, BNP Paribas, Citi, Deutsche Bank, HSBC, Morgan Stanley, Mitsubishi UFG, Nomura and Royal Bank of Canada CM.

The orderbook was opened on Tuesday London morning. Strong participation out of Asia resulted in an orderbook of over USD 3 bn after only a few hours. With the start of the US trading day on Tuesday there was continuous broad based demand from high quality US investors. Given the overwhelming demand, KfW was able to narrow the spread talk from mid swaps plus 30bp area to a range of 28bp to 30bp over mid swaps and decided to accelerate the close of books to noon New York time. The final orderbook amounted to a record volume of USD 6.33bn and enabled KfW to price a USD 4 bn transaction at the tight end of the price range at mid swaps plus 28. Until now, KfW has been the only non US Agency issuer able to sell 10-year global issues with such a success. "Since 2004 we have continuously offered long duration in USD global bonds, and we are now earning the benefits for our longtime commitment: investors appreciate the reliable issuance policy of KfW", said Bräunig.

The final orderbook was well diversified and of extremely high quality with over 130 individual orders from investors around the globe. This again demonstrates the strong interest for the excellent credit risk of KfW, whose bonds are explicitly guaranteed by the Federal Republic of Germany, as well as their appreciation of KfW's USD strategy.

The breakdown of the order book by sectors is as follows:

Breakdown by investor type:

Banks: 35%
Central Banks: 34%
Funds: 30%
Others: 1%
Geographical Breakdown:
Americas: 42%
Asia: 34%
Europe: 21%
Middle East: 3%
KfW has announced a funding volume of EUR 70-75 bn for 2010. The Benchmark Programmes in EUR and USD will again account for the main share of the funds raised. With this transaction KfW has already reached circa 18% of its announced total funding volume for 2010.

Term Sheet KfW USD II/2010

USD 4 billion - 4.000% - 2010/2020

ISIN: US500769DP65
Issuer: KfW (Kreditanstalt für Wiederaufbau)
Guarantor: Federal Republic of Germany
Rating: AAA (Fitch Ratings)/Aaa (Moody's)/AAA (Standard & Poor's)
Size: USD 4,000,000,000.--
Maturity Date: 27th January 2010 - 27th January 2020
Coupon: 4.000% p.a., semi-annual coupon Payment Dates: January 27th and July 27th
Re-offer-Price: 99.657%
Yield: 4.042% semi-annually
Format: Global
Stock Market Listing: Luxembourg
Lead Managers (3):
Goldman Sachs
JP Morgan
Co-Lead Managers (10):
Bank of America / Merrill Lynch,
BNP Paribas
Deutsche Bank
Morgan Stanley
Mitsubishi UFG
Nomura Royal
Bank of Canada CM
This press release is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. KfW has registered the securities that are the subject of this press release for sale in the United States. The offering of the securities in the United States will be made by means of a prospectus that may be obtained from KfW and will contain detailed information about KfW and its management, financial statements and information about the Federal Republic of Germany.

| presseportal
Further information:

More articles from Business and Finance:

nachricht Blockchain Set to Transform the Financial Services Market
28.09.2016 | HHL Leipzig Graduate School of Management

nachricht Paper or plastic?
08.07.2016 | University of Toronto

All articles from Business and Finance >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: New 3-D wiring technique brings scalable quantum computers closer to reality

Researchers from the Institute for Quantum Computing (IQC) at the University of Waterloo led the development of a new extensible wiring technique capable of controlling superconducting quantum bits, representing a significant step towards to the realization of a scalable quantum computer.

"The quantum socket is a wiring method that uses three-dimensional wires based on spring-loaded pins to address individual qubits," said Jeremy Béjanin, a PhD...

Im Focus: Scientists develop a semiconductor nanocomposite material that moves in response to light

In a paper in Scientific Reports, a research team at Worcester Polytechnic Institute describes a novel light-activated phenomenon that could become the basis for applications as diverse as microscopic robotic grippers and more efficient solar cells.

A research team at Worcester Polytechnic Institute (WPI) has developed a revolutionary, light-activated semiconductor nanocomposite material that can be used...

Im Focus: Diamonds aren't forever: Sandia, Harvard team create first quantum computer bridge

By forcefully embedding two silicon atoms in a diamond matrix, Sandia researchers have demonstrated for the first time on a single chip all the components needed to create a quantum bridge to link quantum computers together.

"People have already built small quantum computers," says Sandia researcher Ryan Camacho. "Maybe the first useful one won't be a single giant quantum computer...

Im Focus: New Products - Highlights of COMPAMED 2016

COMPAMED has become the leading international marketplace for suppliers of medical manufacturing. The trade fair, which takes place every November and is co-located to MEDICA in Dusseldorf, has been steadily growing over the past years and shows that medical technology remains a rapidly growing market.

In 2016, the joint pavilion by the IVAM Microtechnology Network, the Product Market “High-tech for Medical Devices”, will be located in Hall 8a again and will...

Im Focus: Ultra-thin ferroelectric material for next-generation electronics

'Ferroelectric' materials can switch between different states of electrical polarization in response to an external electric field. This flexibility means they show promise for many applications, for example in electronic devices and computer memory. Current ferroelectric materials are highly valued for their thermal and chemical stability and rapid electro-mechanical responses, but creating a material that is scalable down to the tiny sizes needed for technologies like silicon-based semiconductors (Si-based CMOS) has proven challenging.

Now, Hiroshi Funakubo and co-workers at the Tokyo Institute of Technology, in collaboration with researchers across Japan, have conducted experiments to...

All Focus news of the innovation-report >>>



Event News

#IC2S2: When Social Science meets Computer Science - GESIS will host the IC2S2 conference 2017

14.10.2016 | Event News

Agricultural Trade Developments and Potentials in Central Asia and the South Caucasus

14.10.2016 | Event News

World Health Summit – Day Three: A Call to Action

12.10.2016 | Event News

Latest News

Resolving the mystery of preeclampsia

21.10.2016 | Health and Medicine

Stanford researchers create new special-purpose computer that may someday save us billions

21.10.2016 | Information Technology

From ancient fossils to future cars

21.10.2016 | Materials Sciences

More VideoLinks >>>