Fibabanka completes $150m AT1 debt deal amid strong demand

Turkish bank Fibabanka has announced the successful closure of a $150 million debt transaction that qualifies as Additional Tier 1 (AT1) capital. The issuance, a Basel III-compliant PNC5.5 AT1 fixed-rate resettable offering, was three times oversubscribed, underlining strong interest from international investors. The deal was led by Citi, Standard Chartered Bank, and Emirates NBD, with the yield set at 10.25%.

The debt transaction marks a milestone for the Turkish financial sector, as it is the first-ever public sub-benchmark AT1 offering out of Türkiye. AT1 bonds are a form of hybrid debt that banks can use to strengthen their capital reserves, particularly important in times of financial uncertainty.

Confidence in Turkish banking sector

Ömer Mert, General Manager and Member of the Board of Directors at Fibabanka, expressed pride in the success of the issuance, attributing it to the bank’s strong financial performance and strategic direction. “We are very proud to have led the first-ever public sub-benchmark AT1 offering out of Türkiye. The high level of interest from international investors, driven by our strong financial performance and strategic vision, clearly reflects the confidence investors have in both Fibabanka and the wider Turkish banking sector,” said Mert.

The transaction is seen as a significant vote of confidence in Türkiye’s financial system and its ability to attract foreign capital despite ongoing economic challenges. The issuance strengthens Fibabanka’s capital structure, ensuring the bank is well-positioned to continue its growth trajectory both domestically and internationally.

Boost for Turkish economy

Mert also highlighted the broader implications of the deal for the Turkish economy, noting that the high level of demand from international investors reflects positive sentiment towards the country. “This issuance not only strengthens our bank’s capital structure but also underscores the positive sentiment towards the Turkish economy on the global stage. We intend to continue to grow in both domestic and international markets, supported by our innovative product offerings and strong digital infrastructure,” he added.

The success of the transaction underscores Fibabanka’s competitive standing in global capital markets, bolstering the bank’s ambitions to expand its footprint. It also reinforces the strength and stability of Türkiye’s financial sector, which has continued to attract significant foreign capital. This, in turn, supports the country’s broader economic development.

The oversubscription of the offering illustrates investor confidence in the Turkish banking system and its ability to navigate challenging economic conditions. As Türkiye continues to expand its presence in international financial markets, foreign capital will play a crucial role in driving the country’s growth and stability.

Fibabanka, established in 2010, has been steadily growing its banking operations, focusing on digital innovation and product diversification. With the successful completion of this AT1 issuance, the bank now aims to further strengthen its position in both domestic and global markets.

For more information about Fibabanka and its future plans, visit the bank’s website.