The EIB prices a new 5-year US$ 3bn Global Bond

The European Investment Bank (EIB) priced today a successful 5-year US$ global bond. The new US$ 3 billion benchmark with a maturity of 1 March 2007, is the EIB's second US$ denominated Global bond in 2002. Lead managers are Goldman Sachs, JP Morgan and Morgan Stanley.

The EIB's US$ funding program is a major building block of the Bank's presence in the international capital markets. This year, after issuing its first US$ Global in early January, the EIB recognized that a 5-year transaction provided an opportunity to further enhance its franchise in the markets and, in particular, among U.S. investors.

Following a non-deal related roadshow in the US earlier this month, the EIB responded to investor feedback and designed today's transaction with several investor friendly features that were very well received:

• Improved Primary Market Transparency
  For the first time in the EIB's US$ funding strategy, a Joint Lead Pot, Co-Lead Pot plus Co-Lead retention system was employed to greatly improve the transparency of the order taking process and provide a solid foundation for improved performance in the secondary market.
• Longer Book-building Period
  Allowed a longer period of time for investors to make their investment decision.
• Enhanced Secondary Market Trading Potential
  The large US$ 3 billion size was deemed by many investors and dealers as the optimum to achieve a high level of liquidity and maximum performance potential. Additionally, the size enables the bonds to benefit from electronic secondary trading on the TradeWeb® system immediately on settlement date.

The bond was priced at an Issue Price of 99.996%, carries a coupon of 4.625%, resulting in a spread of 50 bps over the 3.5% US Treasury due 15 November 2006.

"This new US$ Global bond is another important example of the EIB's determination to provide investors around the world and in each of the major currencies attractive and liquid investment instruments." said René Karsenti, Director General and Treasurer at the EIB.

"We are very pleased with this transaction, particularly with the increased take-up in the U.S. that reinforces the success of our US$ strategy thus far. Since January 2001, we have already issued US$14 billion in Global format with the last three offerings of US$3 billion or more. We feel that with this bond we have been able to make very good progress towards our target of increased liquidity, transparency and investor diversification. Additionally, we are delighted with the support given to us by the entire syndicate group." commented Barbara Bargagli-Petrucci, Head of Funding Department, and Carlos Guille, Head of Funding, America, Asia and Pacific at the EIB.

Michael Sherwood, Managing Director, Head of Fixed Income, Currency and Commodities at Goldman Sachs commented, "We are delighted to have been entrusted with the mandate to Joint Lead manage this prestigious transaction. The EIB has taken an important step in extending and deepening their franchise and presence with the domestic U.S. investor base."

JP Morgan's Bruce Carnegie-Brown, Managing Director, Co-Head of Debt Capital Markets commented, "The success of this transaction is an affirmation of the market's acceptance of the EIB's strategy in the U.S. dollar market. The depth and quality of distribution in this transaction, particularly into the U.S., is the direct consequence of the EIB's growing franchise in the US."

"This transaction represents an important step in the development of EIB's US Dollar funding programme. The global order book has been of extremely high quality and the approximate 40% distribution into the U.S. is proof of the success of their recent roadshow." said Michael Weston, Managing Director, Head of European Debt Capital Markets at Morgan Stanley.

The European Investment Bank is the European Union's international financing institution - the EU member states are its shareholders. With an AAA/Aaa credit rating, the EIB raises funds in the capital markets to provide long-term funds in support of projects furthering EU economic objectives.