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Madrid 2,266 EUR -0,01 (-0,61 %)

CORPORATE | 04.06.2022

MAPFRE successfully closes a 500 million euro subordinated bond issuance

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It is the first Tier 3 subordinated issuance by a Spanish insurer

MAPFRE has successfully placed the notes of an 8-year subordinated bond, for a total of 500 million euros, with a fixed interest rate set at 3.009 percent. The funds deriving from this transaction will be used to further strengthen the Group’s financial flexibility, in addition to diversifying its sources of financing.

“This issuance serves as yet another illustration of the confidence institutional investors have in MAPFRE. We continue optimizing our debt position, and we are doing so in very satisfactory financial conditions, even within a complex market context such as the current one,” said Fernando Mata, CFO and member of the board of the company. It is the first Tier 3 subordinated issuance by a Spanish insurer

The success of the transaction can be seen in the reduction of the interest paid with respect to previous operations (3.009% vs. 4.125% in August 2018) and in the high level of demand, which exceeded 1.9 billion euros, with broad diversification, which allowed for the bond to be placed among more than 90 institutional investors in several European countries, highlighting France and the UK.

The issuance has been directed exclusively at institutional investors, with retail investors being expressly excluded, as is normal practice with transactions of this nature. Mutual fund managers represent the vast majority of the investors that have participated in the placement (49 percent of the total), followed by insurers and pension fund managers (29 percent).

The notes will qualify as tier 3 instruments of MAPFRE pursuant to the applicable solvency regulation, thus reinforcing MAPFRE’s solvency and financial strength levels. The notes will be quoted on the AIAF market, upon receipt of authorization from the Spanish Securities and Exchange Commission (CNMV).