PKO Bank Hipoteczny will issue Polish zloty-denominated covered bonds worth PLN 265 million with fixed rate 2.69%

• On the 20^th of June 2017 PKO Bank Hipoteczny allocated covered bonds with the maturity date falling on the 10^th of September 2021 and a fixed rate of 2.69% (spread over MidSwap of 57 bps).
• The value of the issue will be PLN 265 million.
• Covered bonds will be issued on the 22^nd of June 2017.

PKO Bank Hipoteczny offered to institutional investors covered bonds with a nominal value of PLN 265 million and fixed rate set after the official bookbuilding process at the level of 2.69% (spread over MidSwap of 57 bps). The maturity date of the bonds falls on the 10^th of September 2021.

Rafał Kozłowski, CEO of PKO Bank Hipoteczny, said: “This time we offered fixed rate covered bonds denominated in Polish zloty. It has been so far the biggest Polish zloty-denominated covered bond issue with fixed rate. Therefore this result is satisfying. As expected, the interest rate of a covered bond with fixed rate is at start a bit higher than its equivalent with floating rate, but it is worth mentioning it will stay unchanged until September 2021.”

12 investors subscribed for covered bond of PKO Bank Hipoteczny. Domestic investors took above 45% of the issue.

The fifth series of Polish zloty-denominated covered bonds is a part of PKO Bank Hipoteczny’s Covered Bonds Issuance Program targeting the Polish domestic market, on the basis of the Base Prospectus approved by Poland’s Financial Supervision Authority (KNF) on the 12^th of November 2015. The covered bonds issued under the Program previously mature between December 2020 and May 2022. Their current coupon is at the range of 2.42% to 2.48%.

In December 2015 Moody’s rated PKO Bank Hipoteczny’s Covered Bonds Issuance Program Aa3 – the highest possible rating for Polish securities. This was reflected in the ratings agency’s report dated the 22^ed of March 2017. Covered bonds are a type of debt instruments secured by payments on mortgage loans, and constitute one of the world’s safest financial instruments. PKO Bank Hipoteczny’s covered bonds are secured solely by Polish zloty-denominated housing loans.

PKO Bank Hipoteczny is the Polish market leader in terms of the volume of its outstanding covered bonds. In 2016 it conducted Poland’s first ever benchmark issue of Euro-denominated covered bonds with a nominal value of 500 million euro, as well as two benchmark Polish zloty-denominated covered bond issues with a total nominal value of 1 billion zloty. In 2017 PKO Bank Hipoteczny issued euro-denominated covered bonds with a nominal value of EUR 525 million and PLN 500 million Polish zloty-denominated covered bonds.