Cyprus Business Now

Hellenic Bank this week announced that it has issued a new €200 million Tier 2 Subordinated bond under the EMTN Programme.

According to the announcement, the bond was issued at its nominal value and carries a fixed annual interest rate of 10.25 per cent.

The maturity date of the bond is June 14, 2033, callable at par for a period of three months commencing March 14, 2028. Settlement will take place on March 14, 2023, and the bond will trade on the Euro MTF market of the Luxembourg Stock Exchange.

The bond attracted significant interest from the investment community, with approximately 90 per cent of demand coming from international investors. The total offer book exceeded €875 million, with a leverage of almost 4.5 times, and contained orders from 135 different institutional investors.

“Strong demand has allowed the bond to be priced down by 50-75 basis points from the original indicative pricing range”, the bank explained.

What is more, the issuance is the first subordinated transaction (Tier 2) of the bank through the EMTN Programme.

“Investors, through the volume of their participation, displayed confidence in the bank and confirmed the capital markets’ positive assessment of the bank’s creditworthiness,” the bank said.

It added that the issuance of the bond further strengthens the bank’s capital structure and is expected to increase the Group’s Capital Adequacy Ratio from 20.6 per cent on December 31, 2022, to an adjusted ratio of 24.1 per cent.

At the same time, the bond is expected to meet the criteria for the bank’s minimum equity and eligible liabilities (MREL) requirement and is consistent with the bank’s financing strategy.

Cyprus’ GDP and employment increased during the fourth quarter of 2022, compared to the previous quarter, according to a report released this week by Eurostat.

In terms of the eurozone as a whole, GDP remained stable while employment also increased.

Cyprus recorded the third-largest increase in GDP and the fourth-largest increase in employment during this time, compared to the third quarter of the year.

In the fourth quarter of 2022, Cyprus’ seasonally adjusted GDP increased by 1.1 per cent.

Conversely, it decreased in the European Union as a whole, while it remain broadly unchanged in euro area member states.

Meanwhile, employment in Cyprus increased by 0.7 per cent, compared with a rise of 0.3 per cent in both the EU and the eurozone respectively.

Regarding GDP, there had been a growth of 1.6 per cent in Cyprus during the third quarter of 2022, compared to 0.4 per cent in both the euro area and in the EU as a whole.

By member state, Greece (recorded the highest increase in GDP with a rise of 1.4 per cent, compared to the previous quarter, followed by Malta with 1.2 per cent and Cyprus with 1.1 per cent.

The highest decreases were observed in Poland with a contraction of 2.4 per cent, followed by Estonia and Finland with 1.6 per cent and 0.6 per cent respectively.

The Cyprus Stock Exchange (CSE) ended Friday, March 10 with losses.

The general Cyprus Stock Market Index was at 110.59 points at 12:30 during the day, reflecting a decrease of 1.35 per cent over the previous day of trading.

The FTSE / CySE 20 Index was at 66.82 points, representing a drop of 1.36 per cent.

The total value of transactions came up to €73,571.

In terms of the sub-indexes, the main and investment firm indexes fell by 1.85 per cent and 4.96 per cent respectively. The alternative and hotel indexes remained stable.

The biggest investment interest was attracted by the Bank of Cyprus (-2.59 per cent), Hellenic Bank (no change), Demetra Holdings (-5.17 per cent), Mallouppas & Papacostas (-2.38 per cent), and Woolworth Cyprus (no change).