Depfa Bank to repurchase, cancel €1.06 billion of subordinated debt

By Sarah Lizee

Olympia, Wash., Nov. 15 – Depfa Bank plc and two of its funding vehicles, Depfa Funding II LP and Depfa Funding III LP, plan to repurchase and cancel €1.06 billion of subordinated debt funded by the sale of public sector assets from the Depfa Group, according to a notice.

The subordinated debt includes €700 million of 6.5% guaranteed non-voting non-cumulative perpetual preferred securities and €360 million of subordinated loans. The subordinated loans were originally issued by Hypo Public Finance Bank and taken over by Depfa in March 2008.

The buyback and cancellation of the preferred securities and the subordinated loans will take place on a reverse enquiry basis.

The pricing of the buyback and the sale of the public sector assets will be conducted on an arm's length basis and assessed at fair market values determined as of close of business today for trading Nov. 18 with settlement on Nov. 21.

Depfa is a financial services company based in Munich.

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