Novo Banco provides 20 million euros with early repayment of a debt of 300 million
The financial institution pays a fee of 3.5%. The payment will become effective on July 23 of this year. The CFO says the issuance shows the bank’s “strong capital generation”.
Miguel Balthazar
Novo Banco has decided to advance the repayment date of 300 million euros of large debt, the institution announced in a statement sent to the Securities Market Commission. The operation makes it possible to save 20 million euros in interest.
“Novo Banco has informed that, following the authorization received by the Individual Resolution Board, it has taken a decision to early repay the €300 million issue,” writes the bank led by Mark Burke.
The bonds in question paid a rate of 3.5% and matured in 2024. The terms of the issue specified that if the bank did nothing, that rate would double. With this operation, the financial institution avoids this aggravation, saving 20 million euros.
Early repayment is effective on July 23, 2023, “subject to the terms and conditions of the obligations set forth in the prospectus dated July 20, 2021 in relation to these obligations.”
“Repayment without replacement of €300m of bonds indicates a strong generation of capital from Novo Banco’s business” and follows the recent issuance of subordinated debt in the amount of €500m after demand tripled supply, Which led the institution to increase the total value of securities by 100 million euros.
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