(Bloomberg) -- Deutsche Pfandbriefbank AG has sold its first benchmark-sized bond since the German bank’s exposure to commercial real estate loans sent its debt into a tailspin.
The lender issued a €500 million ($527 million) long three-year green senior preferred bond on Wednesday, according to a person familiar with the matter, who asked not to be identified. PBB will use the proceeds to finance green loans tied to renovations or the construction of new buildings.
Pricing was set at spreads of 180 basis points over mid swaps, broadly unchanged from initial talk levels, while books were recorded above €500 million.
Concerns about the state of the US commercial property market earlier this year hit banks in New York, Japan and Europe, among them PBB. The lender’s Additional Tier 1 bonds, the riskiest type of bank debt, fell to less than 20 cents on the euro in February. The bonds have since recovered to about 75% of face value.
Its new bond sales since the episode have focused on smaller issues that tend to be less liquid and not widely distributed. A separate €500 million senior preferred green bond is now indicated higher than where it stood at the beginning of the year.
(Updates with final pricing details.)
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