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AGENCE FRANÇAISE DE DÉVELOPPEMENT SUCCESSFULLY PRICED A NEW 4.125% £350 MILLION BENCHMARK DUE 22ND JULY 2027

communication financière AFD

On Monday 15th January, Agence Française de Développement (AFD), rated AA /AA- (S&P / Fitch), issued its first GBP benchmark of the year, a £350 million 3.5-year fixed rate benchmark due on the 22nd July 2027 which offers a spread of 50bps over Sonia mid-swaps.

 With a robust Sterling market backdrop, the transaction was announced at 09:55 CET on Monday 15th January 2024. Books opened concurrently, with initial price guidance of Sonia mid-swaps +50bps area. 

Despite significant Sterling supply throughout January, the transaction captured high quality investor demand from the outset. At 11:53 CET, books surpassed benchmark size with an announcement in excess of £275mn (incl. £25mn of JLM interest). With no spread tightening across SSA Sterling transactions this year, at this point the final spread was set at Sonia mid-swaps + 50bps, providing further clarity to investors. 

Setting the spread provided additional momentum and books closed above £400mn (incl. 25mn JLM) at 12:45 CET. Anchored by quality investor demand, this allowed the final size to be set at £350mn. 

In terms of allocations, the transaction was well diversified across fund managers (46%) and central banks / official institutions (37%), with banks and insurance accounts taking 9% and 7% respectively. 

By geography, the UK investor base continued to show strong support for AFD issuance, receiving 68% allocation. Away from this, allocation was again well-diversified, with 9% each to accounts in the Americas and Asia, and 7% allocated to Nordic accounts. 

Thibaut Makarovsky, Head of Funding and Market Operations at AFD: “After an initial benchmark in EUR, we decided to return to the GBP market for the third year running, taking advantage of favorable conditions. We are delighted with the reception and support we have received from investors. Our objective remains to be present on this market over the long term as part of our refinancing program. We will be in a position to look at new opportunities as soon as our 2024 borrowing ceiling is announced at the end of January.” 

  • Issuer : Agence Française de Développement 
  • Ratings : AA Negative outlook (S&P) / AA- Stable outlook (Fitch) 
  • Size of the transaction : £350,000,000 
  • Pricing Date : 15th January 2024 
  • Settlement date : 22nd January 2024 
  • Maturity Date : 22nd July 2027 
  • Reoffer Price : 99.746% 
  • Coupon : 4.125% 
  • Reoffer Yield : 4.211% A / 4.168% SA 
  • Reoffer Spread : +50bps vs SONIA MS 
  • Reference UKT : +53.5bps vs UKT 1 ¼ 07/22/27 MID 
  • Listing : Euronext Paris 
  • Governing Law : French 
  • ISIN : FR001400ND61 
  • Joint Lead Managers : Barclays, Deutsche Bank, NatWest Markets N.V. 
  • Use of Proceeds : General Corporate Purposes 

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