The issue, led by Deutsche Bank and Standard Chartered Bank and rated A- stable/A3 positive, marked the NFFCÆs first international public debt offering. The book closed at $435 million, with bonds allocated to 37 accounts. The trade followed a roadshow that encompassed Hong Kong, Singapore and London.
In terms of comparables, bankers quote Kookmin Bank and NACFÆs January 2012 issues, which were both trading at 24bp over Libor. On a rating adjustment basis, Suhyup Bank priced flat to NACF, primarily because it was a first time issuer. Bankers note a four-month extension at a lower rating by one basis point.
61% of the bonds sold to Asian accounts and 39% to Europe, with 61% allocated to banks, 17% to funds and 4% to undefined investors. Two large buyers of Korean quasi-sovereign bonds were conspicuously absent from the trade.
The issue is part of the bankÆs $1 billion medium-term note programme. Rated one level below government debt, the bank provides financing for the NFFC, which has roughly $2.75 billion in bonds outstanding. The ratings reflect the ôstrong government support for the bankÆs policy roleö, according to Standard and Poor's.
Although the bankÆs business is not highly profit-oriented, Suhyup has increased its exposure to the non-policy sector and gradually been evolving into a more commercially-minded lending institution.