EIB launches Hungarian Forint (HUF) Step-Down Euro-Tributary Notes

The European Investment Bank (EIB) today launched the first-ever Hungarian Forint (HUF) step-down Euro-Tributary notes. The HUF 10 billion 9.50% notes, maturing on 15th October 2012, provide liquidity to the long dated HUF market and follow on from the EIB's HUF20bn eurobond issue in June 2001 - the first ever Forint denominated eurobond issue - which opened up the HUF international capital markets. The HUF10 billion issue has an initial coupon of 9.50% from the issue date until 15th October 2006, when it will step down to 5.375%, thus matching the coupon of the EIB 5.375% EARN due October 2012. As and when Hungary joins the European Monetary Union, the issue may be re-denominated into Euros (at the exchange rate established by the Council of the European Union) and consolidated with the EIB 5.375% EARN due October 2012.

Redenomination and consolidation cannot take place before the coupon steps down on 15th October 2006.The issue price and the re-offer price are 102.05% and 100.30% respectively. At the re-offer price, the notes yield an IRR of 7.421%.The bonds are issued on a stand-alone basis and will be listed in Luxemburg. Payment date is 18th July 2002.Dresdner Kleinwort Wasserstein is acting as sole lead manager on the issue.

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

Dresdner Kleinwort Wasserstein (DrKW) is the marketing name for the investment bank within the Corporates and Markets Division of Dresdner Bank AG, a member of the Allianz Group since July 2001. Headquartered in London, Frankfurt and New York and with an international network of offices, DrKW provides a wide range of investment bank products and services to European and international clients through its Investment Banking and Capital Markets business lines.