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12 Jan 2022 17:58
BFF: successful placement of an additional tier 1 bond issuance; open market purchase programme

Milan, 12 January 2022 – BFF Bank S.p.A. (the “Bank” or the "Issuer") announces that it has successfully completed the placement of a new bond issuance to be qualified as additional tier 1 capital in accordance with applicable laws and regulations, addressed to institutional investors, with a nominal amount of Euro 150 million. The bond issuance is aimed at optimizing and strengthening the regulatory capital structure of the Bank and diversifying its funding sources.

The bonds are perpetual (with maturity linked to the corporate duration of the Bank) and may be called by the Issuer on any calendar day during the six-month period commencing on 19 January 2027 and ending on 19 July 2027 and thereafter on any interest payment date.

The bonds pay, on a semi-annual basis, a fixed rate coupon of 5,875% per annum for their first 5.5 years; if not called, the coupon will be reset every 5 years to the aggregate of the then 5-Years Mid-Swap rate plus the spread originally applied at issuance. Coupon payments are fully discretionary and subject to certain limitations.

The trigger of 5.125% of Common Equity Tier 1 (CET1) provides that, if the CET1 ratio of the Group or the Bank is below such trigger, the nominal value of the additional tier 1 bonds will be temporarily reduced for the amount needed to restore the trigger level, taking into account also the other instruments with similar characteristics.

The rating agency Moody's is expected to rate the Notes B2.

The bond has been distributed to different institutional investor categories such as Hedge Fund and Asset Management, with a broad geographical diversification in the final allocation originated for about 80% in UK and Italy.
The settlement of the bond issuance is scheduled on 19 January 2022. The bonds will be listed issuance on the MTF of Euronext Dublin.

In connection with the bond issuance, Morgan Stanley acted as Sole Global Coordinator and Sole Bookrunner.
The Bank’s legal counsels were the law firm White & Case (Europe) LLP and, in relation to the tax aspects, the law firm Gatti Pavesi Bianchi Ludovici. Clifford Chance Studio Legale Associato assisted Morgan Stanley.

 

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The Bank has approved an open market purchase programme with respect to the following securities: (i) €200,000,000 2.00 per cent. Notes due 2022 (the “2022 Notes”); and (ii) €300,000,000 1.750 per cent. Senior Preferred Notes due 23 May 2023 (the “2023 Notes” and, together with the 2022 Notes, the “Notes”). Following the tender offer announced and completed in June 2021, the nominal amount outstanding is approximately Euro 42.8 million for the 2022 Notes and approximately Euro 40.0 million for the 2023 Notes.

The purchase transactions may apply to the entire nominal amount outstanding of the Notes and will be carried out with direct counterparts on the market until 30 June 2022. The maximum purchase price will be adjusted on the basis of the trading price of the Notes.

The purpose of the repurchase programme is to allow the Bank to optimise its balance sheet, and proactively use its available cash, whilst maintaining a prudent approach to liquidity. The Notes repurchased will be cancelled.
The Bank announces that, if the nominal amount outstanding of the 2022 Notes as a result of the repurchases is equal to, or lower than, Euro 30 million, the Bank reserves the right to exercise the call option set out in Condition 6(c) (Clean-Up Call Option) of the terms and conditions of the 2022 Notes.

 

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This press release does not constitute an offer to sell securities in the United States of America. The securities mentioned herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or under any other securities laws of any state of the United States of America or in Australia, Canada or Japan, or in any other jurisdiction in which such offer or solicitation is subject to the approval of the local authorities or would, in any event, be unlawful.

The securities mentioned herein may not be offered or sold in the United States of America to, or on behalf of, or for the benefit of, a U.S. person (a “U.S. person”, as defined in Regulation S of the Securities Act), unless they are registered under the Securities Act or an exemption under the Securities Act is available.
In Member States of the European Economic Area (the “EEA”), this release is only intended for and may only be addressed to persons classified as “qualified investors” (the "Qualified Investors") pursuant to article 2(e) of Regulation (EU) 2017/1129.

This announcement is directed only at persons (i) who are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the "Order") or (ii) who have professional experience in matters relating to investments falling within Article 19(5) of the Order or (iii) to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). Any investment or investment activity to which this communication relates is only available to relevant persons and will be engaged in only with relevant persons, or in the EEA, with Qualified Investors. Any person who is not a relevant person, a Qualified Investor or otherwise permitted under applicable law or regulation to access this announcement, should not act or rely on this announcement.

MiFID II professionals/ECPs-only / No PRIIPs KID – Manufacturer target market (MIFID II product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs key information document (KID) pursuant to Regulation (EU) 1286/2014 (the “PRIIPS Regulation”) has been prepared as not available to retail in EEA.

This release does not constitute an offer to sell or a solicitation to purchase financial instruments. No action has been or will be taken to allow a public offering of the bonds in any jurisdiction, including Italy. This release (and the information contained herein) may not be published or distributed, directly or indirectly, in the United States of America, or in Australia, Canada or Japan, or in any other country in which such publication or distribution would be subject to the approval of the local authorities or would, in any event, be unlawful.