Hungary's OTP Bank launches €500 million 10-year notes to yield mid-swaps plus 320 bps

By Rebecca Melvin

New York, July 8 – Hungary’s OTP Bank NyRt launched €500 million of 10-year subordinated notes (expected rating: Ba1) to yield mid-swaps plus 320 basis points on Monday. Final pricing was expected to occur later in the session, according to a market source.

The fixed-rate reset notes are callable after five years. The interest rate will be reset in 2024 to the sum of the then prevailing five-year mid-swap rate plus a margin. It is a one-time reset with no step-up.

Pricing was fixed tight to early guidance of mid-swaps plus 325 bps to 337.5 bps following initial price talk for a spread of 350 bps to 375 bps over mid-swaps.

Order books were in excess of €1 billion when terms were set at the tight end of guidance.

BNP Paribas, Citigroup and OTP Bank were bookrunners for the Regulation S notes.

OTP is the largest commercial lender in Hungary.

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