• On 27 June, PKO Bank Hipoteczny launched a subscription addressed to institutional investors for green covered bonds of EUR 500 million, maturing on 25 June 2025.
• Declarations of interest were collected from more than 50 investors for a total amount of over EUR 850 million.
• During the book bulding process a margin of 36 bp over EUR Mid-Swaps was set. The securities bear a fixed interest rate in euro.
• PKO Bank Hipoteczny’s covered bonds will be listed simultaneously on the Luxembourg and Warsaw stock exchanges.
On 27 June, PKO Bank Hipoteczny launched a subscription for institutional investors for a successive issue of covered bonds of EUR 500 million maturing on 25 June 2025. This issue was the Bank’s first euro-denominated green covered bond issue. The proceeds from the issue are intended to be used to finance and refinance low carbon emission residential buildings. This is the sixth benchmark issue in EUR placed by PKO Bank Hipoteczny.
“This issue is very important not only for PKO Bank Hipoteczny, but also, I hope, for the entire covered bond issuer market in Poland. As a Bank, we aim to continuously improve the quality of our covered bonds and increase investors’ trust worldwide. We hope that other issuers from Poland will follow in our footsteps and that the number of issuers of green bonds will increase. PKO Bank Hipoteczny is strengthening its position as a trusted issuer of covered bonds on the international financial market, as evidenced by the more than a 40 per cent reduction in subscriptions for the latest issue. This success is all the more significant for us as it was carried out in challenging market conditions”, says Katarzyna Surdy, Vice President of the Management Board of PKO BH. “Many thanks to the investors for their trust. This is a reason for satisfaction, but first and foremost is excellent motivation to continue our efforts and strengthen our position as the leader of the mortgage bank market in Poland,” she adds.
The current issue is the twenty-first one carried out by the Bank, counting both EUR and PLN-denominated mortgage bond issues. The total value of the covered bonds issued and outstanding as at 4 July 2022 was PLN 12.3 billion.
Mortgage covered bonds are a type of bonds which are secured with mortgage loan receivables. PKO Bank Hipoteczny’s covered bonds are issued solely on the basis of residential mortgage loans in Polish zlotys which are granted based on conservative criteria in terms of both the assessment of creditworthiness of the borrowers and the valuation of the underlying real properties. Green covered bonds are secured by residential loans selected on the basis of the PKO BH Green Covered Bond Framework and are certified by the Climate Bond Initiative.
PKO Bank Hipoteczny's covered bonds – both denominated in zloty and in euro – have been rated Aa1 by Moody's Investors Service. The level of rating assigned is the highest possible for Polish securities.
Bank Hipoteczny acquires loans for its portfolio through strategic cooperation with PKO Bank Polski, including selling residential loans via the largest network of branches, intermediaries and agents in Poland, and purchasing receivables portfolios from PKO Bank Polski.
PKO Bank Hipoteczny is the largest mortgage bank and the most active issuer of covered bonds in Poland. As the only issuer from Poland, since November 2016, it has been carrying out euro-denominated benchmark covered bond issues (with a minimum value of EUR 500 million) targeted at institutional investors from the international market.