On the back of tightening Spanish government bond spreads and evidence of investor demand for Spanish risk, ICO announced its new 5-year Euro transaction on Monday October 22, 2012.

The bond has had strong international demand, more than 50%, especially from large European managers.

The transaction was executed on a very quick timetable (books were open for less than 4 hours), in order to limit exposure to ongoing market volatility. The bond priced at 99.851%, paying a coupon of 4.875% on a annual yield of 4.916%, in line with initial guidance.

Background on ICO
Instituto de Crédito Oficial – ICO – is a State-owned corporate entity attached to the Ministry of Economy and Finance of the Spanish Government. With its more than 30-year history, ICO has become a benchmark credit institution in the financing of both SME and large-scale infrastructure projects, not only in Spain but also abroad. The institute's purpose is to boost any economic activity which, on account of its social, cultural, innovative or ecological significance, merits promotion and development.

Terms of Transaction
Issuer: Instituto de Credito Oficial (ICO)
Ratings: Baa3 (neg) / BBB- (neg) / BBB (neg)
Principal Amount: EUR 1,000,000,000
Pricing Date: October 22, 2012
Settlement Date: October 29, 2012
Maturity Date: July 30, 2017
Re-Offer Spread: SPGB+ 65bps
Coupon: 4.875% annual
Reoffer price/ yield: 99.851% / 4.916% annual
Joint Bookrunners: BBVA/ GSI/ HSBC/ J.P. Morgan
Co-lead managers: Banesto/Caixa Bank/Commerzbank/Helaba/RBC CM/Santander