BBVA places a Tier 2 subordinated debt issue worth €1.25 billion, with demand outpacing supply by a factor of five
On Wednesday of this week, BBVA placed €1.25 billion in a 12-year Tier 2 subordinated debt issue, with a call option at seven years. The market response has been excellent, with demand reaching nearly €6 billion, five times the amount ultimately allotted. The price was set at mid swap + 240 basis points, significantly below the starting price (mid swap + 275 basis points).
The bookrunner banks have been BBVA, Deutsche Bank, HSBC, Morgan Stanley and Société Générale. The debt issue is part of BBVA’s 2024 funding plan and aims to make the capital structure more efficient.
This is BBVA’s second debt issue in 2024, after placing €1.25 billion of senior preferred debt with a 10y-ear maturity in January. This same month, BBVA Mexico placed an additional $900 million of Tier 1 subordinated debt.