NIB Capital Bank NV

Rating: A3/A-/A

Amount: Eu700m

Maturity: 31 October 2008

Issue/re-offer price: 99.927

Coupon: three month over Euribor plus 17.5bp

Launch date: Monday 17 October

Payment date: 31 October

Joint books: Deutsche Bank, Merrill Lynch, SG CIB

Bookrunners' comments:

Deutsche -- The issuer was downgraded by the ratings agencies a little while ago after the pension funds that owned them sold the bank to a private equity group. But the ratings are now stable and we were able to get away a good deal.

We roadshowed all over and met upwards of 50 investors.

After those meetings we set the price guidance at between 18bp and 20bp over Euribor and we had a good response, but there was a lot of price sensitivity in the market and the rational choice was to price at the wider end.

With this guidance we managed to attract a book of Eu800m and we reviewed the desire to raise Eu500m. In the end we printed a benchmark Eu700m transaction that went well.

Merrill Lynch -- In terms of a Europe-based bank that has gone through significant ownership changes and a resulting three notch rating downgrade, NIB is a unique story. The institution wanted to clarify its current position with investors and to use this transaction to re-establish its name in the institutional market.

We took the company through London, Ireland, Paris and Germany on probably the best attended roadshow I have been involved in for a senior FRN.

There was extremely broad interest from investors who already had exposure to the name and those that had specific interest in a new issue.

The message was put across by the company in a clear fashion and people came away positive about the story.

The borrower wanted to show that operationally its very much business as usual for the bank although the ownership has moved from two insurance companies in the Netherlands to a consortium led by JC Flowers.

We went out with price guidance early on in the marketing process, which was on the third day of the roadshow. This was because, with a story as involved as this one, investors were taking 24 to 48 hours to make their decisions.

We deliberately left that time available to investors to get their lines in place.

The intention was always to use a full week's marketing and to price the transaction at the beginning of this week. The initial target of Eu500m was easily attained and we ended up with a slightly oversubscribed book for a Eu700m issue.

The price guidance was Euribor plus 18bp-20bp and we priced at 20bp. Comparables include Alpha Bank (A3/BBB+) Octover 2008s trading at plus 20bp, Montepio Geral (A3/A-) November 2008s trading at plus 19bp and Capitalia (A2/A-) October 2008s trading at plus 15bp. NIBs July 2008s trade at 18.5bp/16.5bp and its July 2010s at 23bp/21bp.

The issue achieved broad distribution, with most of the tickets for cash. It was thought at the beginning of the marketing period that there may be a risk that investors would switch out of some of the shorter dates to go into this transaction, thus maintaining a neutral credit line position.

The fact that this was not the case is testament to the strength of the story that was relayed by the management.

SG -- This went well, especially in light of the fact that the credit was downgraded three notches following the buy-out by a consortium led by JC Flowers.

We had an extensive four day roadshow that took in London, Dublin, Paris and Frankfurt and met a range of investors. The issuer wanted to explain the new credit following the downgrades and this was taken on board by the investor base.

This would have come at 7bp or 8bp over Euribor three months ago, but this time we had to push guidance out to 18bp to 20bp over.

The issuer wanted the bond to perform and as such wanted to leave something on the table for investors. With that in mind, we priced the deal at the wide end of guidance and it has come in slightly to 19.3bp over in the secondary market.

There is plenty of NIB paper in the market and so it was a simple process to price the trade along the interpolated curve.

We printed the deal at Eu700m after pulling together a book of Eu800m. The majority was sold in the UK, Germany, Italy and Spain, with banks taking around 85% of the paper.

Market appraisal:

"...they have done well to get this away at this size, especially just after the issuer was downgraded."

"...interesting that they brought this at the wide end of guidance -- it shows what the market thought of the name. That said, they got the deal done in a market where there was little appetite for the name."