Bloomberg News

Banco Popular Espanol Sells Unsecured Bonds After ECB Boost

March 02, 2012

Banco Popular Espanol SA (POP) sold senior unsecured bonds for the first time since 2011 as three-year loans from the European Central Bank buoy the region’s lenders.

The Spanish bank issued 750 million euros ($990 million) of 18-month senior unsecured bonds that were priced to yield 275 basis points more than the benchmark mid-swap rate, according to data compiled by Bloomberg.

The Madrid-based bank joined Italy’s UniCredit SpA and Banca Monte dei Paschi di Siena SpA in selling unsecured debt after the market was virtually shut to lenders from Europe’s peripheral nations before the ECB’s first so-called longer-term refinancing operation in December. The central bank has now pumped 1 trillion euros into the region’s financial system, helping drive down bank and government borrowing costs.

“There’s been a flurry of issuance from peripheral banks that had previously been closed out,” said Roger Doig, an analyst at London-based Schroders Plc.

Banco Popular last issued unsecured debt in April 2011 when it sold 500 million euros of two-year bonds to yield 240 basis points more than mid-swaps.

A spokesman for Banco Popular in Madrid, who declined to be identified citing company policy, wouldn’t comment. Bankia SA, Goldman Sachs Group Inc., Natixis and Royal Bank of Scotland Group Plc managed the deal with Banco Popular.

To contact the reporter on this story: Katie Linsell in London at

To contact the editor responsible for this story: Paul Armstrong at

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