Luminor has successfully completed a €300m bond issue. The new issue follows Moody’s upgrade of Luminor's rating on 13 September. In addition, the bank has repurchased €228m of existing bonds which mature in 2022. The transactions, which were completed on 23 September, further improve Luminor’s funding efficiency and lower Luminor’s cost of funds.  

Palle Nordahl, Chief Financial Officer, commented:

"We have taken an important step to meet our future regulatory requirements, while also strengthening our liability structure and enhancing our investor base. The significant support from investors demonstrates the solid standing of Luminor and the positive outlook of the Baltic economies. These transactions ensure that we are well placed to continue to support our clients and grow our business throughout our home markets of Estonia, Latvia and Lithuania."

Luminor held a series of virtual meetings with European asset managers on 14 and 15 September. The bank launched its new issue on 16 September following positive feedback from investors, including those who wanted to tender their holdings of Luminor’s existing 1.375% security due in 2022.

The new issue was significantly oversubscribed with Luminor receiving orders from over 80 investors, across more than 20 countries. The size, quality and diversity of the orders enabled Luminor to price the new security with a coupon of 0.539%, its lowest coupon for this type of bond. Orders from German-speaking Europe accounted for a third of the total book, which also saw good demand from the Baltic, Western Europe, and Mediterranean regions.

The bond, which is rated Baa1 by Moody’s, is listed on the Irish Stock Exchange, and was issued under Luminor’s EMTN and Covered Bond programme. Luminor Markets acted as a joint lead manager for both transactions

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