Rabobank to Buy Back EUR1 Billion of Its Certificates to Manage Its Capital
Miriam Mukuru
Rabobank plans a EUR1 billion ($1.06 billion) cash tender offer to buy back Rabobank certificates, which form part of its Common Equity Tier 1 capital, it said in a press release on Tuesday.
"The purpose of the tender offer is to allow Rabobank to actively manage its capital efficiency while maintaining a strong balance sheet," the bank said.
The offer commences on April 16, and will expire at 1500 GMT on April 30, and settlement will take place on May 3.
The tender offer should be viewed in a similar way to a share buyback, said CreditSights analyst Puja Karia in a note.
"This is the first time it is launching a buyback for these securities, which, although packaged like bonds, are equity-like securities," Karia said.
CreditSights expects Rabobank's CET1 ratio to decline to 16.7% from 17.1% assuming the bank repurchases the entire amount.
Write to Miriam Mukuru at miriam.mukuru@wsj.com
(END) Dow Jones Newswires
April 16, 2024 10:47 ET (14:47 GMT)
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