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CEC Bank successfully attracted over 650 million RON equivalent through an inaugural issue of MREL (Minimum Requirement for own funds and Eligible Liabilities) eligible bonds, the bank informs on Friday.
According to a press release, CEC Bank obtained, at the end of December, the approval from the Luxembourg Stock Exchange for the multi-year bond issue prospectus and successfully placed, during this week, the first tranches, through a private placement to professional investors, in RON and euro, with a cumulative value of over 650 million lei, Agerpres informs.
"After 3 years of growth and modernisation, CEC Bank has successfully attracted private financing, through the capital markets. Thus, we can continue the strategy of transforming CEC Bank into a modern and agile bank," said Bogdan Neacsu, general manager of CEC Bank.
Within the approved prospectus, CEC Bank can issue bonds of several types (senior unsecured, subordinated or bonds eligible for the minimum requirement of own funds and eligible liabilities), within the limit of a ceiling of 600 million euros (or equivalent in other currencies), on periods between 2 and 10 years. The bank intends to list these instruments on the Bucharest Stock Exchange in the coming weeks, the release says.
The private placement carried out was subscribed by financial and non-financial institutions and companies and was structured in two tranches, as follows: the EUR tranche, in the amount of 97.3 million euros with a maturity of 3 years and the RON tranche, in the amount of 175 35 million lei, with a maturity of 3 years.
The bonds issued are non-preferred senior bonds, and the cumulative value of the two tranches is 656.6 million lei, approximately 11 percent more than the target the bank had in mind for this operation.
"This first inaugural issue represents a first step in the preparation of larger issues, including with the participation of international investors, which will be launched starting in 2023 and subsequently listed on regulated markets," the bank's press release also states.
Raiffeisen Bank Romania, through the Investment Banking division, brokered the transaction through which the bonds issued by CEC Bank were offered to professional investors.
"We are happy to be able to contribute to the development of the capital market and financial brokerage in Romania, beyond our own lending activity. We used our capital market expertise, recognized in the field of bonds, as well as the experience gained in our own issues of this kind, as to support other market participants, banks of systemic importance such as CEC Bank, in obtaining the eligible MREL financing necessary for the growth of activity," declared Mihail Ion, vice-president of Raiffeisen Bank.
For the entire bond programme, CEC Bank benefits from the support of a consortium of international banks, with legal assistance from Dentons and Clifford Chance law firms, through their local offices.
CEC Bank is the financial institution with the longest tradition in Romania. Founded in 1864, CEC Bank currently has the most extensive national network, with over 1,000 branches and territorial units and with assets of over 53.4 billion lei, at the end of the first half of 2022.
CEC Bank is a leading universal bank on the Romanian market and offers a complete range of products and services to individuals, SMEs and large corporations, through multiple distribution channels: bank units, ATM networks, internet banking, mobile banking and the store virtual CEC_IN - where banking products and services can be accessed 100 percent online.
