By Rebecca Melvin
Concord, N.H., Oct. 13 – The European Commission, on behalf of the European Union, sold €12 billion 0.4% green bonds due Feb. 4, 2037 under the region’s NextGenerationEU program.
NextGenerationEU is a temporary recovery instrument of more than €800 billion to support Europe's recovery from the coronavirus pandemic and help build a greener, more digital and more resilient Europe.
The bond came at a reoffered yield of 0.453%, or spread of negative 8 basis points to mid-swaps, according to a news release. The spread is equivalent to 31.6 bps over 15-year Bunds due May 2036.
Bank of America Securities Europe SA, Credit Agricole CIB, Deutsche Bank AG, Nomura Finance Products Europe GmbH and TD Securities were joint lead managers of the offering. Danske Bank AS, Intesa Sanpaolo SpA and Banco Santander SA were co-leads.
The bond was more than 11 times oversubscribed with books exceeding €135 billion.
The issuance follows adoption of the NextGenerationEU Green Bond framework in September.
The funds will be used to finance green and sustainable expenditures under the Recovery and Resilience Facility. Eligible investments from the already approved plans include a research platform for energy transition in Belgium, or the construction of wind power plants on land in Lithuania.
The bonds will be listed on the Luxembourg Stock Exchange.
| Issuer: | European Commission
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| Issue: | Green bonds
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| Amount: | €12 billion
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| Maturity: | Feb. 4, 2037
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| Bookrunners: | Bank of America Securities Europe SA, Credit Agricole CIB, Deutsche Bank AG, Nomura Finance Products Europe GmbH and TD Securities
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| Co-leads: | Danske Bank AS, Intesa Sanpaolo SpA and Banco Santander SA
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| Coupon: | 0.4%
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| Yield: | 0.453%
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| Spread: | Minus 8 bps to mid-swaps
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| Announcement date: | Oct. 12
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