Introduction
Funding and Liquidity Management
In order to meet investors’ requirements for diversification, DEPFA’s funding team provides a comprehensive range of highly liquid, highly rated and performance-focussed debt securities. As one of the most active issuers of debt securities in Europe, DEPFA BANK’s funding platform comprises short- and long-term products in plain vanilla or structured format, either secured or unsecured debt.
DEPFA ACS BANK and DEPFA Deutsche Pfandbriefbank are both active issuers of secured debt, whereas the primary issuer of unsecured debt is DEPFA BANK plc.
| Short-Term Products | Long-Term Products |
|---|---|
| Money Market Deposits Commercial Paper Programmes Certificates of Deposits Repos |
Benchmark Public Sector Asset Covered Securities Benchmark Public Sector Pfandbriefe Publically Syndicated MTN Private Placement MTN Registered ACS Schuldscheine/Promissory Notes Extendible Notes |
Our institutional sales teams serve the world’s most important institutional investors through the marketing and sales of our own liability products. We are also a large depository counterparty for central banks and public-sector entities worldwide. Our sales teams are located in Dublin, New York and Tokyo.
| Transaction details | |
|---|---|
| Issuer: | DEPFA ACS BANK |
| Rating: | Aaa/AAA/AAA |
| Bookrunners: | Goldman Sachs, JP Morgan, Morgan Stanley |
| Size: | USD 2 billion |
| Coupon: | 4.75%, annual |
| Settlement: | 12 October 2007 |
| Maturity: | 12 October 2010 |
| Pricing: | US Treasury +71.25 bps, Mid Swaps -2 bps |
| Format: | Eurobond |
| Listing: | Dublin |
Transaction highlights
- DEPFA re-opened the USD covered bond market with a highly successful $ 2bn 3yr Eurodollar benchmark what was their largest USD benchmark since October 2002
- Books opened on Thursday afternoon in response to the demand from investors for a short-dated, public sector benchmark issue ahead of the US non-farm payroll figure on Friday.
- Price guidance for the issue was ms -2 bps. Order books filled rapidly at this guidance and reached $ 1bn within 2hrs, ending the London session at $1.4bn.
- Books finally closed at 10.30am on Friday with a final volume in excess of $2.25bn. Given the high quality of the order book, and in order to underline the strategic nature of the project, the decision was taken to upsize the transaction to $ 2bn, making this the largest ever DEPFA ACS USD benchmark
- 90% of the book was made up of real money accounts, which were good at re-offer. The transaction therefore priced at UST +71.25 bps, which corresponds to ms -2 bps
- The success of this transaction is largely down to the increased diversification needs of investors in the wake of the credit/ money market crisis, making a DEPFA ACS benchmark issue an obvious choice for investors.
- The transaction went on to perform well in the secondary market tightening 0.5-0.75bps vs. swaps on Friday afternoon
