BCP has decided not to use the prepayment option on the debt line, which was launched on the market in 2017 and has a five-year maturity, indicating market conditions. However, this gives bondholders the opportunity to exchange these bonds for new ones maturing within 10 years.
The bank, led by Miguel Maia, reported Securities Market Commission (CMVM) “decision not to use the early redemption option” of its €300 million subordinated debt issue, which was issued with a 4.5% coupon and maturing in December 2027.
“In substance and in accordance with the final terms, the coupon will be reset to the mid-swap rate effective December 5, 2022, and the initial margin of 4.267% per annum,” he explains.
In view of the decision not to exercise the early redemption option, BCP also announced the launch of a swap offer offering current holders of these bonds “the option and opportunity to exchange them for new” bonds maturing within 10 years and three months. The terms of the new offer are not yet known.
The decision not to prepay this debt “was made after weighing several factors, including current and unusual market conditions, as well as the recognition of Tier 2 capital issuance and MREL,” the bank said in a statement, adding that “it will evaluate and decide whether whether to use future prepayment options on other instruments on a case-by-case basis”.
