April 9 (SeeNews) - Alpha Bank Romania said on Tuesday it plans to launch a 1 billion euro ($1.2 billion) mortgage bond programme in Romania on the Luxembourg and Bucharest stock exchanges.
The first issue of mortgage bonds under the programme, with a limit of 200 million euro, will take place in the near future, Alpha Bank said in a press release.
"We are pleased to announce the first mortgage bond programme in Romania, an initiative that continues our pioneering tradition in the banking field after launching in 2001 the first real estate loan. Through this programme, Romania will be among countries that have both a modern legislation and an active mortgage bond market," Alpha Bank Romania's executive chairman Sergiu Oprescu said.
Moody's will assign ratings to the bonds issued under the programme. According to the bank, mortgage bonds are a financing solution commonly found on international financial markets whereby the issuing bank seeks to diversify funding sources and lower their average cost, attracting new funds for the development and expansion of its activities.
At European Union level, about 27% of mortgages from financial institutions are funded by mortgage bonds, a common solution used by all banking systems in Europe, the bank added.
The project is being carried out in collaboration with Barclays Bank PLC investment bank as arranger, PwC as agent, Allen & Overy London and RTPR Allen & Overy as advisors and Clifford Chance Badea and Clifford Chance London as issuer counselors.
Alpha Bank Romania was founded in 1993 as Banca Bucuresti by Greece's Alpha Bank Group and the European Bank for Reconstruction and Development. At the beginning of 2000, the Bucharest Bank was renamed as Alpha Bank Romania to underline its membership in the group.
The bank posted a gross profit of 20.9 million euro in 2018.
At end-2018, it operated 130 units in Romania and employed 1,976.
($=0.887 euro)
Alpha Bank Romania SA is among the biggest banks in SEE. You can download our SEE Top 100 ranking
here or subscribe to our free Top 100 newsletter
here