Debut benchmark of Sparkasse Hannover

Basically, the initial idea for the move to the benchmark format emerged at the beginning of 2023. Due to positive business development and the upcoming TLTRO repayments, our medium-term funding forecast showed a corresponding refinancing requirement. We were therefore faced with the choice of covering this through many smaller issues or individual larger ones. However, benchmark issues require good preparation, so we initially continued to issue in the sub-benchmark segment. At the same time, we developed and implemented a catalogue of measures to sharpen Sparkasse Hannover’s profile on the capital market. These included, for example, the preparation of a new securities prospectus in the middle of last year to bring our documentation up to date – which involved considerable effort. In addition, we had our public cover pool rated in autumn 2023, which, like our mortgage cover pool, now has an AAA-rating from Fitch. Intensive investor work is also crucial for successful positioning on the capital market. To this end, we used various formats in the months leading up to the issue to present ourselves as a future regular Pfandbrief issuer in benchmark format. In the final weeks before the issue, we prepared the detailed marketing together with the joint lead managers we had selected. Starting with the fine-tuning of our investor presentation through to the recording of the Global Investor Call in English. Following the announcement of the issue, we held a live webcast and various one-on-one meetings with interested investors.
This very intense preparation paid off in the end. Favoured by the carefully chosen timing of the issue, we attracted a great deal of attention and were able to generate demand of over EUR 1.4 billion at the peak. In the end, our book was more than twice oversubscribed – at an attractive spread for both issuer and investors. What we are particularly pleased about is the high proportion of foreign orders, at around a quarter. As a result, we were also able to significantly broaden our investor base, as we had hoped. All in all, a complete success!

Sparkasse Hannover’s mortgage cover is very granular with an average loan volume of around 150,000 euros, there are no foreign mortgage assets, no derivatives and over 80 % have a residential background. There is also a small, well-diversified commercial portion and, of course, a regional focus with the Hannover Region as our home market. We have provided more detailed information on our website. All relevant presentations and information on sustainability are published there.

A clear ‘yes’. We have actively communicated to the market that our long-term plan envisages a benchmark issue every one to two years and that we will not be a one-hit wonder.