20th May, 2025

The FIG market continues to offer investors a variety of issuance, including the extended resurgence of the AT1 market. On Monday, the two subordinated transactions produced total orders of EUR6.2bn for the EUR1.5 bn of new bonds on offer. Intesa Sanpaolo's EUR1bn PNC AT1 was the focus of the day and books were extremely healthy at EUR3.6bn, even if easing back from the EUR5bn peak, allowing a 50bps price cut to a final 6.375% from IPT 6.875%. And French insurer Groupama Assurances Mutuelles' EUR500m no grow 10-year Tier 2 bullet also saw strong investor demand with final books at EUR2.6bn. IPTs were m/s +220 but strong appetite allowed a 30 bp reduction and a closing spread at m/s +190.

On Tuesday morning the market has sprung into life with seven issuers bringing deals across the capital structure. The AT1 theme is very much in focus again with deals for KBC Group and Banco BPM, although the call structures are slightly shorter than the recent trio of trades. The Tier 2 sector sees Aviva plc who have not issued in Euro since November 2018 bring a 31.25NC11.25 subordinated deal. Three borrowers are accessing the SNP space, including Banco Santander with a 7-year , Credit Agricole with a 10-year Social bond and Danske Bank with an 8NC7 offering. Finally, Nomura Holding is launching an inaugural 5 year senior deal.

Aviva plc returns to Euro issuance with first Tier 2 deal

**Aviva plc, rated A2 (Moody’s) / A (S&P) / A+ (Fitch), has mandated Citi as Sole Structuring Advisor to the Issuer and Citi, Crédit Agricole CIB, Deutsche Bank, Santander and Societe Generale as Joint Lead Managers to arrange a series of fixed income investor calls on 19 May 2025. A EUR denominated Reg S bearer €600m (will not grow) 31.25NC11.25 Fixed to Floating Rate Tier 2 transaction due 28 August 2056. Pay date 28 August. Fixed Rate End Date 28 August 2036.

IPTs MS + 235 bps area

• Not seen in the euro market since November 2018 when the issuer printed a senior deal.
• The issuer's last public bond issuance of any sort was in March 2025 with a GBP500m PNC 8 RT1.
• The inaugural nature of this deal means there are no direct comparables, although leads supplied some recent industry related reference points, including Allianz, Nippon Life and Vienna Insurance Group whose bonds were yielding between 4.248%-4.591% to their respective calls (m/s+170-205bp). Books opened for Aviva at m/s+235bp area.

Santander brings 7-year senior pref

**BANCO SANTANDER, S.A. rated A2/A+/A (pos/st/st) by Moody's, S&P and Fitch, has mandated Barclays, BNP PARIBAS, J.P. Morgan, Mediobanca, NatWest, Santander, TD Securities and UBS Investment Bank as bookrunners to lead manage its upcoming EUR benchmark 7-year (27 May 2032) Senior Preferred Reg S bearer transaction. Santander will act as the Sole Global Coordinator of the transaction. The notes are expected to be rated A2 (Moody’s) / A+ (S&P) and A+ (Fitch). Pay date 27 May.

IPTs: MS + 115bps area

• Santander's last activity in the senior preferred space was in Jan 2024 when the borrower brought a EUR1.25bn 4NC3 at m/s +95. But for closer comparables in terms of tenor, the issuer has June 2030 and Jan 2034 bonds outstanding which were seen at m/s+71 and m/s+94 pre-announcement. Referencing those suggests far value in the context of m/s + high 80s.

Banco BPM maintains AT1 supply

**Banco BPM S.p.A. (Ticker: BAMIIM), rated (Moody’s / S&P / Fitch / DBRS): Baa2 (On review for upgrade) / BBB (Positive) / BBB- (Positive) / BBBH (Stable), has mandated Barclays, Morgan Stanley as Joint Global Coordinators and Banca Akros, Barclays, BNP PARIBAS, BofA Securities, Citi, Crédit Agricole CIB, Morgan Stanley (B&D) as Joint Bookrunners for a EUR400mn WNG Perp5.5 AT1 Reg S, Dematerialised Form issue, Expected Issue Ratings (Fitch / DBRS): B+ / BBL. Pay Date: 27 May. First Reset Date: 27 November 2030. Coupon: Fixed rate of [●] per annum until the First Reset Date and thereafter reset every 5 years (the “Reset Date”) to the aggregate of the Margin plus the then 5-Year Mid-Swap Rate, calculated on an annual basis and then converted to a semi-annual rate in accordance with market conventions. Non-cumulative and in each case payable semi-annually. Interest Payment Dates: 27 May and 27 November of each year, starting on 27 November 2025. Write-Down following a Trigger Event: If, at any time, the CET1 Ratio (taking into account applicable transitional arrangements) of the Issuer on a solo basis, or the Group on a consolidated basis is less than 5.125% (a “Trigger Event”), then the Issuer shall irrevocably and mandatorily (without any requirement for the consent or approval of the Holders) cancel any interest accrued and reduce the Outstanding Principal Amount by the Write-Down Amount (on a pro rata basis with other Loss Absorbing Instruments) until the CET1 Ratio of the Issuer and/or Group is restored to 5.125% - see further Condition 6.2.

IPTs: 6.875% area

• The issuer is maintaining the recent flurry of AT1 issuance with a new PNC5.5, a slightly shorter call than the recent trio (Banco Sabadell PNC6, Erste Bank PNC7.4 and Intesa PNC8). The most recent of those, (Intesa), priced at 6.375% following a 50bp tightening. By comparison, Banco BPM is also starting with IPTs at 6.875% area.

CA lines up 10yr social SNP

**Credit Agricole S.A., rated A1/A+/A+ (Moody's/S&P/Fitch), has mandated Crédit Agricole CIB (B&D) as Sole Bookrunner and BBVA, Bankinter, SEB and Swedbank as JLM (no books) for a EUR Benchmark RegS Bearer dematerialised form (au porteur) Senior Non-Preferred Fixed Rate Notes due 27 May 2035, Exp. Issue Ratings: A3/A-/A+ (Moody's / S&P / Fitch). Pay date 27 May. Optional Clean-up Redemption Date: 27 May 2026 and any Interest Payment dates thereafter.

IPTs: MS+165bps area

• Credit Agricole returns to the SNP market with its first deal since Sept 2024, which came as part of a dual-tranche offering of 10-year Green and a long 4NC3 SNP notes. Those EUR1bn and EUR750m trades attracted orders of EUR5bn and EUR2.6bn respectively.
• The longer note was included in the comps list, and last seen at m/s+127bp while its 12-year SNP from Feb 2024 was seen at m/s+125bp, which would suggest fair value in the mid-120bp range.

Ticker Issue Date Ratings (M/S/F) Amount Coupon Maturity Call Date Yrs I+ Bid ESG

ACAFP 19/09/2024 A3/A-/A+ 1000 3.5 26/09/2034 - 9.4 127 Green

ACAFP 19/02/2024 A3/A-/A+ 1250 4.125 26/02/2036 - 10.8 125 -

Select European Peers

BNP 06/02/2024 Baa1/A-/A+ 1550 4.095 13/02/2034 - 8.7 129 -

RABOBK 22/01/2024 A3/A-/A+ 1000 3.822 06/07/2034 - 9.2 108 -

NDAFH 11/03/2024 A3/A/AA- 1000 3.625 15/03/2034 - 8.8 108 -

SHBASS 08/02/2024 A2/A/AA 750 3.75 15/02/2034 - 8.7 100 Green

Danske returns after a year with 8NC7 SNP

**Danske Bank A/S (Ticker: DANBNK), rated A1/A+/A+/A+ by Moody’s/S&P/Fitch/Scope (all stable), has mandated Barclays, Danske Bank (B&D), ING, Morgan Stanley, Natixis as Joint Bookrunners for a EUR500m exp. 8NC7 due 26 May 2033 Reg S, Bearer, New Global Note Green Non-Preferred Senior issue, Exp. Issue Ratings: Baa1/A-/A+/A by Moody’s/S&P/Fitch/Scope. Pay date 26 May 2025. Call option: 26 May 2032 (7y). Coupon: Fixed, Annually, Act/Act ICMA. If Call Option not exercised, a reset fixed rate of interest per annum determined as the sum of the prevailing 1-year EUR Mid-Swap Rate plus the Margin, payable annually in arrear.

IPTs: MS+145 bps area

• Danske Bank comes back to the SNP market after over a year, last seen in this format in April 2024 with a EUR1bn, short-dated 3NC2 FRN. For this venture, the issuer has reverted to fixed format with an 8NC7.
• The call date falls in May 2032, some four months after the seller's 8NC7 printed in Jan 2024 at m/s+142bp. That was spotted on the comps list at 105bp pre-announcement.

KBC brings AT1

**KBC Group NV (Ticker: KBCBB), rated A3 / A- / A (Stab / Positive / Stab) (Moody’s / S&P / Fitch), has mandated J.P. Morgan as Global Coordinator and Barclays / BNP Paribas / BofA Securities / Goldman Sachs International /J.P. Morgan / KBC Bank as Joint Bookrunners for a EUR Benchmark RegS, dematerialised Perpetual NC5.5 Undated Deeply Subordinated Additional Tier 1 Fixed Rate Resettable Callable Securities (the "Securities"), Expected issue ratings: Baa3 / BB+ / BBB- (Moody’s / S&P / Fitch). Pay date 27 May. First Reset Date: 27 November 2030.

IPT: 6.500% area

• KBC Group joins Banco BPM in selecting a PNC5.5 call structure for its new AT1 transaction. The transaction follows a EUR750m PNC7 from Sept 2024, which was the borrower's last issuance in this format. That deal was seen in the comps list, bid at 5.841% to the call date, which falls in Sept 2031. By comparison, books opened for the new notes, callable 27 Nov 2030, at 6.5% area.

New format for Nomura

**Inaugural EUR-denominated Regulation S 5-year fixed rate senior unsecured benchmark notes are being marketed by Nomura Holdings. The notes will be in registered form and issued under Nomura Holdings’ Euro Note Programme dated 16 May 2025. The notes are intended to be TLAC eligible under the TLAC regulations in Japan and expected to be rated Baa1 (Moody’s) and A- (Fitch). FCA/ICMA stabilization applies.

IPT is at Mid Swap+145bps area;

• Nomura selected a 5-year format for its inaugural senior unsecured EUR offering, opening books at m/s+145bp area. The transaction marks just the second offering of EUR senior unsecured notes from a Japanese borrower this year, following Mizuho's EUR650m 8.25NC7.25 fixed-to-floating trade.

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