LHV Group's Subordinated Bonds Offer: A Successful Endeavor

Successful Closure of LHV Group Subordinated Bonds Subscription

The public offer for subordinated bonds of AS LHV Group concluded recently, reflecting a significant interest from investors. A remarkable total of 2,293 unique investors participated, subscribing for bonds amounting to EUR 49.64 million. The original issue volume of EUR 20 million witnessed an oversubscription by an impressive factor of 2.5.

Details of the Subscription Period

The subscription period for these bonds began on 29 October, concluding on 12 November. Throughout this time, many investors displayed a strong interest in contributing to LHV Group’s financial endeavors, making the subscription period a noteworthy event in the financial markets.

Allocation Principles for Investors

According to the rules established in LHV Group’s bond prospectus, the Supervisory Board finalized the subscription outcomes, issue volume, and allocation methods for the bonds. The principles guiding these allocations were crafted to ensure fairness and transparency, leading to an equitable distribution among different categories of investors. This includes fulfilling all subscription orders of previous non-professional clients up to EUR 5,000.

Investor Allocation Breakdown

The allocation of bonds was structured as follows: previous non-professional investors were allocated 33.50% of their subscribed amount exceeding EUR 5,000, while previous non-professional customers received 27.50% above their thresholds. New investors had a 20% allocation on amounts over EUR 2,000, and institutional investors were granted 20% of their total amount subscribed.

Comments from LHV Group Management

Madis Toomsalu, the Chairman of the Management Board, expressed gratitude to investors for their belief in LHV’s vision, highlighting that the new capital will allow the organization to rapidly expand its loan portfolio and overall business operations. He noted that this bond issuance also provided investors an appealing opportunity for returns, particularly in a declining interest rate environment.

Details About the Bond Issue

With the conclusion of this bond issuance, LHV Group is now issuing 20,000 subordinated bonds, each with a nominal value of EUR 1,000 and an annual interest rate of 6.0%. These bonds will have a redemption date set for 15 November 2034. On approximately 15 November, the bonds will be transferred to investors' securities accounts, with expectations to list them on the Baltic Bonds List of Nasdaq Tallinn on around 18 November.

Significance of This Bond Program

This recent issuance marks the second wave of subordinated bonds under LHV’s ongoing bond program, which was confirmed earlier this year. To date, the total issuance under this program has reached EUR 35 million, with the potential to raise as much as EUR 200 million in total.

LHV Group: Leading Financial Provider

LHV Group stands as the largest domestic financial group and capital provider within Estonia. The key subsidiaries, including LHV Pank and LHV Varahaldus, play vital roles in the group’s extensive financial services portfolio. Employing over 1,200 individuals, LHV Group serves a vast client base, demonstrating robust growth and commitment to customer satisfaction.

Frequently Asked Questions

What are the key highlights of LHV Group's bond offer?

The bond offer saw participation from 2,293 investors, raising EUR 49.64 million, with a notable oversubscription rate of 2.5 times the original issue volume.

How were the bonds allocated to investors?

The allocation was based on several principles prioritizing previous non-professional customers, followed by institutional investors, with varying percentages allocated based on subscription amounts.

What is the annual interest rate for the newly issued bonds?

The subordinated bonds come with an annual interest rate of 6.0%, making them an attractive option for investors.

When will the bonds be listed on the stock exchange?

The bonds are expected to be listed on the Baltic Bonds List of Nasdaq Tallinn on approximately 18 November.

What is LHV Group's position in the financial market?

LHV Group is recognized as the largest financial group in Estonia, providing extensive banking and financial services, with a growing number of clients nationwide.

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