CaixaBank sells €1 billion in 10-year mortgage covered bonds below Spanish Treasury bonds' price
On Tuesday the Barcelona-based bank, which is the largest financial entity within the Spanish market, attracted a strong €2.6 billion demand, 88% of which came from international investors. It was CaixaBank's 10-year mortgage covered bond first issue since 2007, before the financial crisis. The operation will boost the Catalan bank's liquidity position, which stood at €60.762 billion at year-end 2013, 17.9% of its total assets. In addition, it satisfies demand from institutional investors for this product. The issue price was 80 basis points over the mid-swap rate and better than expected thanks to strong investor demand. This means CaixaBank sold the mortgage covered bonds at an interest rate of 2.625%, 67 basis points below the last rate for a similar issue by the Spanish Treasury.