Hana prices tier 1 landmark

The Korean bank brings the world''s first non investment grade rated tier 1 deal.

A smaller than expected $200 million perpetual non-call 10 issue for Hana Bank was priced yesterday Tuesday by lead managers JPMorgan and Barclays Capital. Pricing came at the outer end of the deal's indicative range, but the premium to Korean upper tier 2 debt was tight relative to the levels paid by much higher rated European comparables for tier 1 over tier 2 debt.

Priced at par, the deal has a coupon of 8.748% and a Treasury spread of 450bp or 405bp in Libor terms. The main pricing benchmark was Hanvit Bank's March 2005 upper tier 2 transaction and this was trading at 305bp over Treasuries or 285bp over Libor. Hana consequently paid a...

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