Commentary & Deal Flow

• The day began with a flurry of activity in the Swiss Franc market with several large domestic prints hitting the screens. As the morning progressed we were set for ostensibly another zero-print session in the European € IG public markets, that is until SEB stepped forward to announce a €500m (wng) 1 tranche Tier 2 offering, which drew all the attention for the day.
• Elsewhere there was zero activity in £, Chf & $ Reg S IG primary. 
• Today’s “Talking Point” (below) tracks € IG Corp 5 & 10yr spread averages by rating bands YTD.
• Brent is trading off session highs at c.$88.05 (peaked at $90).
• Equity markets in Europe have surprised to the upside, with all the main bourses up c.0.2% to 0.5%.
• Expecting a quiet session tomorrow.
• A breakdown of today’s primary € supply is as follows.
  • Corporate
    • Total IG: €0
    • Avg. tranche size €0
    • Avg. IPT to Pricing NA
    • Avg. cover NA
  • FIG
    • Total IG: €500m
    • Avg. tranche size €500m
    • Avg. IPT to Pricing NA (covered)
    • Avg. IPT to Pricing -30.0 (unsecured)
    • Avg. cover 3.0 X
  • SSA
    • Total IG: €0
    • Avg. tranche size €0
    • Avg. IPT to Pricing NA
    • Avg. cover NA
• Pipeline: There are no €, £, Chf or Reg S $ transactions in the IG pipeline.

Talking Point

• The two charts below track € IG Corp 5 & 10yr spread averages by rating bands across 2026; & there are two main features worth highlighting before reading the data at face value.
• The first is the apparent inversion between BBB 5 & 10yr spreads from January into February, where the 5yr average is seen to trade at or through the 10yr. In normal market conditions, this would naturally be unusual. On closer inspection, however, this anomaly is a composition effect rather than a true inversion of spreads; the 5yr BBB bucket in early January included credits such as Sveafastigheter which priced as wide as 185bps, while the 10yr bucket was anchored by the likes of Cellnex at 120bps & Heidelbergcement at 98bps. The BBB category spans a wide range of credit quality & such anomalies can occur from time to time.
• The second observation is the lag between the onset of the US-Iran conflict in early March (shown as the dotted red line) & the visible widening in spreads, which did not materialise until late March into early April, approximately 2 to 3 weeks after the conflict began. The Amazon mega-deal on the 11th of March across 4, 6 & 9yr tranches at 48bps, 63bps & 83bps may also have temporarily masked the widening pressure building at that point.
• The scale of the eventual move is clear in the data. Brent crude moved from $81.40 on the 4th of March to $112.57 by the 27th of March; a move of approximately 38% in just over 3 weeks, while the VIX peaked at 30.61 on the 30th of March. The repricing is visible in prints from mid-to-late March onwards; in the 5yr bucket, Akzo Nobel priced at 130bps, Kion at 155bps & Akelius at 140bps, while in the 10yr bucket Akzo Nobel printed at 170bps, each a clear step wider relative to the 65-80bps range seen in the better quality Corp prints earlier in the year.

Euro IG (today)

• Skandinaviska Enskilda Banken AB - SEB -  (exp. Issue rating A3 / A- / A by Moody’s S&P & Fitch) announced a €500m (wng) 11NC6 Tier 2 with IPTs in the area of MS+130, via BNPP, CACIB, JPM, SEB & UBS. The book was updated mid-morning to stand above €2bn (incl €75m JLM). Final terms were set just before midday as €500m at MS+100, backed by a book above €2.65bn (incl €75m JLM), pre-rec. 
  • This will be the Issuer’s third public € offering in 2026. It has also placed a little above $2bn in a funding mix of public & private trades, across the capital stack so far this year. 

Week-to-date volumes:

Year-to-date volumes:

Sterling IG (today)

• No Supply

Week-to-date volumes:

Year-to-date volumes:

Swiss Franc IG (today)

• No Supply

Week-to-date volumes:

US$ Reg S (today)

• No Supply

Pending Deals & Mandates 

• None

Transaction Details:

PRICED: SEB €500m 11NC6 T2; MS+100bp

IGC European Market: Commentary - General

Reoffer: 11NC6: MS+100bp / 99.749 / 4.048%

Benchmark: 11NC6: DBR 1.7 15-Aug-32 @ 93.37 / B+112.8bp / HR 100%

Final Books: Over €1.5bn (incl. €75m JLM). Peak book: Above €2.65bn (incl. €75m JLM) (pre-reconciliation)

Launched: 11NC6: €500m @ MS+100bp - Books above €2.65bn (incl. €75m JLM) (pre-reconciliation)

Book Update: Books above €2bn (incl. €75m JLM)

IPTs: 11NC6: MS+130a

• Issuer: Skandinaviska Enskilda Banken AB (publ) ("SEB")
• Issuer LEI: F3JS33DEI6XQ4ZBPTN86
• Issuer Credit Rating: Aa3/AA-/AA+ (Stable/Stable/Stable) (Moody's/S&P/Fitch)
• Expected Issue Ratings: A3/A-/A (Moody's/S&P/Fitch)
• Status of the Notes: Tier 2 Subordinated Notes, Unsecured
• Ranking Condition: Condition 3B applies (Status – Subordinated Notes)
• Offering Format: Reg S only, NGN, Bearer form, TEFRA D rules apply (no communications with or into the U.S. or Canada)
• Trade Date: 11-Aug-26
• Settlement: 18-Aug-26 (T+5)
• Maturity: 18-Aug-37
• Optional Redemption Date: 18-Aug-32
• Size: €500m
• Reoffer: MS+100bp / 99.749 / 4.048%
• Benchmark: DBR 1.7 15-Aug-32 @ 93.37 / B+112.8bp / HR 100%
• Coupon: Fixed 4% payable annually until the Optional Redemption Date, then reset to the prevailing 5-year EUR Mid Swap Rate + Re-offer Spread, payable annually
• Day Count Fraction: Actual/Actual (ICMA)
• Optional Early Redemption (Issuer Call): The Bank may, upon the expiry of the appropriate notice, redeem all (but not some only) of the Notes then outstanding on the Optional Redemption Date and at the Optional Redemption Amount together with interest accrued to (but excluding) the relevant Optional Redemption Date, subject to approval by the Swedish FSA
• Early Redemption: Upon the occurrence of a Capital Event or a Tax Event, SEB may redeem all (but not some only) of the Notes, at their Early Redemption Amount (par), together, if appropriate, with interest accrued to (but excluding) the date of redemption (subject to prior approval of relevant authority)
• Substitution or Variation: If at any time a Capital Event or Tax Event occurs, or to ensure effectiveness or enforceability of Condition 16.03 (Bail-in and Loss Absorption Power) SEB may at any time either substitute all (but not some only) of the Notes for, or vary the terms of the Notes provided that they become Qualifying Notes instead of redeeming the Notes (subject to prior approval of relevant authority)
• Events of Default: Condition 6B applies
• Waiver Set-Off: Condition 3C applies
• Business Day Convention: Following business day convention, unadjusted
• Business Days: T2
• Denominations: €100,000 and integral multiples of €1,000 thereabove
• Clearing: Euroclear / Clearstream
• Law: English law, except provisions related to the Status of the Notes which shall be governed by Swedish law
• Listing: Euronext Dublin (Regulated Market)
• ISIN: XS3473782244
• Documentation: SEB's Global Programme for the Continuous Issuance of Medium Term Notes and Covered Bonds (the "Programme") with information memorandum dated 12-Jun-26 (the "Information Memorandum")
• Selling Restrictions: As per the Programme
• Fees: The Joint Bookrunners will be paid a fee by the Issuer in respect of the placement of the Notes
• Target Market: Manufacturer target market (EU MIFID II / UK MiFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No EU PRIIPs key information document (KID) or UK DISC disclosure document has been prepared as not available to retail in EEA or the UK.
• Joint Bookrunners: BNP Paribas, Crédit Agricole CIB, J.P. Morgan, SEB, UBS Investment Bank (B&D)
• Advertisement: The Information Memorandum is available, and the Final Terms, when published, will be available at https://sebgroup.com/investor-relations/debt-investors
• Timing: ToE 15:15 CEST / FTT 15:45 CEST

Tier 2
11NC6 (Aug 2037) @ MS+130a
Implied Spread for fresh 11yr @ MS+100
Priced at MS+100
NIC of +0

Details correct at time of posting