Strong investor demand has led to the successful placement of the largest MREL bond issue in Bulgaria, totaling €60 million, according to TBI Bank, the issuer of the bonds. The bank initially aimed to raise between €30 million and €40 million, but the offering was oversubscribed due to significant institutional interest.
Bulgaria AIF Fund participated in the issue, purchasing €700,000 worth of bonds from the recent TBI MREL IPO. The bonds were acquired at par value (100 nominal) with a 7.00% annual coupon, paid once per year.
Near-Zero Transaction and Maintenance Costs
The transaction was executed directly with the issuer, which is possible during IPOs, rather than through a brokerage intermediary. While the resulting cost savings were modest — approximately 0.30% — this demonstrates our ongoing commitment to achieving the most efficient terms for our investors.
Furthermore, there are no maintenance fees associated with holding the bonds through the Central Depository, making the total costs related to this issue negligible.
Expected Listing on the BSE
The bond issue will soon be listed for trading on the Bulgarian Stock Exchange (BSE). However, Bulgaria AIF Fund does not intend to trade these bonds and plans to hold them until maturity. Although the bonds mature in 2028, the issuer retains a call option in 2027, which could result in just two annual coupon payments of 7.00% each.
While this fixed-income instrument provides an attractive yield and low volatility, our team remains focused on exploring the diverse and dynamic investment opportunities within the Bulgarian market — opportunities well known and appreciated by local entrepreneurs like ourselves.
