Reșița will be a prosperous, open and green city, promoting an extensive and creative process of urban regeneration, based on participation and community involvement, with a
diversified, resilient local economy that offers an increased level of quality of life and a superior urban vitality. Reșița is a city in western Romania and the capital of Caraș-Severin County. It is located in the Banat region. The city has a population of 58.393 according to the intermediate results of the 2021 census
City Of Reșița Green Bonds 2033
Private placement (estimated Sept.-Oct. 2023)
- Total issue
- €17200000
- Volume
- 172000 bonds
- Face Value
- €100.00
- Eq. Spread
- 3.5000%
Firm Indications Of Interest
| Quantity | Spread | Allocated Quantity | Date |
|---|---|---|---|
| 250.00 | 2.5000% | 250.00 | 2023-11-14 11:47:12 |
| 200.00 | 2.5000% | 200.00 | 2023-11-17 12:15:02 |
| 350.00 | 2.8500% | 350.00 | 2023-11-13 16:16:40 |
| 500.00 | 3.0000% | 500.00 | 2023-11-16 12:15:40 |
| 400.00 | 3.4500% | 400.00 | 2023-11-16 13:53:48 |
| 3850.00 | 3.5000% | 3850.00 | 2023-11-06 13:31:49 |
| 1020.00 | 3.5000% | 1020.00 | 2023-11-06 13:32:24 |
| 400.00 | 3.5000% | 400.00 | 2023-11-07 14:41:15 |
| 1600.00 | 3.5000% | 1600.00 | 2023-11-07 17:10:54 |
| 500.00 | 3.5000% | 500.00 | 2023-11-13 11:16:26 |
| 500.00 | 3.5000% | 500.00 | 2023-11-14 11:49:55 |
| 370.00 | 3.5000% | 370.00 | 2023-11-14 13:53:43 |
| 200.00 | 3.5000% | 200.00 | 2023-11-14 17:00:17 |
| 200.00 | 3.5000% | 200.00 | 2023-11-15 15:53:32 |
| 503.00 | 3.5000% | 503.00 | 2023-11-15 15:53:53 |
| 200.00 | 3.5000% | 200.00 | 2023-11-15 15:54:19 |
| 1245.00 | 3.5000% | 1245.00 | 2023-11-15 15:54:46 |
| 200.00 | 3.5000% | 200.00 | 2023-11-16 10:52:45 |
| 200.00 | 3.5000% | 200.00 | 2023-11-16 16:54:07 |
| 1500.00 | 3.5000% | 1500.00 | 2023-11-16 17:18:14 |
| 340.00 | 3.5000% | 340.00 | 2023-11-17 13:07:12 |
| 610.00 | 3.5000% | 610.00 | 2023-11-17 13:08:21 |
| 610.00 | 3.5000% | 610.00 | 2023-11-17 13:09:37 |
| 500.00 | 3.5000% | 500.00 | 2023-11-17 13:11:52 |
| 360.00 | 3.5000% | 360.00 | 2023-11-17 13:28:39 |
| 200.00 | 3.5000% | 200.00 | 2023-11-17 13:31:23 |
| 70000.00 | 3.5000% | 70000.00 | 2023-11-17 16:42:59 |
| 423.00 | 3.5000% | 423.00 | 2023-11-20 13:25:56 |
| 221.00 | 3.5000% | 221.00 | 2023-11-20 15:11:27 |
| 444.00 | 3.5000% | 444.00 | 2023-11-20 15:13:33 |
| 400.00 | 3.5000% | 400.00 | 2023-11-21 11:14:07 |
- Total issue
-
€17,200,000
- Volume & Face Value
-
172,000 bonds each worth of €100 face value
- Transaction
-
Private placement (estimated Nov. 2023)
- Bond Type
-
Dematerialized Green Bonds to be listed to Bucharest Stock Exchange
- Use of Proceeds
-
According to Resita Local Council Decision no. 231/2022 to co-finance EU funded project of green public transportation. Electric tram transportation (abandoned in 2011) rehabilitation by:
- reconstruction of the double tram line for 5.28 miles
- rehabilitation of the tram depot
- purchasing 13 of 60 feet electric bi-directional tram cars (to ensure 6-7 minutes back-to-back frequency)
- purchasing 10 of 40 feet electric buses for those neighborhoods that are not covered by tram
- bicycle and pedestrian lanes for 3.7 miles
Project aims to entirely eliminate City’s diesel/gas public transportation.
Part of same pool, City will use exceeding proceeds to co-finance a 23.8 MW solar farm to cover both public buildings’ consumption, and public transportation as well. Any excess power to be injected into the national grid.
- Maturity
-
Nov. 2023
- Principal Repayment (1)
-
Principal to be repaid in 5 annual instalments (1) at even coupon payment date (anniversary) during 2029-2033.
Each of the instalments represent percentages of the total initial issue, as follows: 12% in 2029, 18% in 2030, 20% in 2031, 23% in 2031, and 27% in 2033.
Consequently, face value to decrease pro-rata after each instalment.
(1) Art. 63 para. (4) of the Law no. 273/2006 regarding Local Public Finance forbids new local public debt from being raised when annual repayment plus interest for existing debt exceeds 30% of the City’s own revenue. Although these bond proceeds will be merely used for co-financing EU funded projects –which situation is regulated by the exempt foreseen by Art. 63 para. (51) of the same law –, prudential rationale of keeping debt indicators to match internationally agreed upon debt standards conveyed for the issuer to decide this less usual 5 annual instalments for the principal repayment during 2029-2033.
- Fixed Date Call Option (2)
-
At the 12th coupon payment date (2029) (2)
(2) Given the principal repayment (see footnote 1), the City is committed to use the 2029 call option. In this scenario, sources for principal repayment are its own revenues and/or a roll-over bond issue. In fact, setting principal repayment in 5 annual instalments not only observes the provision of the Art. 63 para. (4) of the Law no. 273/2006 but rather constitutes a safety solution to address risks associated to the “if necessary” 2029 rollover bond issue.
- Floating Coupon
-
EURIBOR 6m + Spread (% p.a.) semiannually paid.
For this bond issue purpose, “spread” is defined here as the fixed margin (% p.a.) that added to EURIBOR 6m will result the floating coupon. Spread will result from the outcome of professional investors bidding at the end of the subscription period.
Whether EURIBOR 6m becomes negative during bond lifetime, coupon will be calculated as spread only.
- Guarantees
-
Full pledge over City’s own revenues according to the Law no. 273/2006 regarding Local Public Finance.
- Rating
-
City of Resita Fitch rating BBB– outlook stable, standalone bbb+, issue not rated
- Green Bond Framework
-
SPO (Second-Party Opinion) provided by Sustainalytics UK; UN SDG targets:
- 9.1. & 11.2. Clean transportation
- 7.2. Renewable energy
ISSUER OVERVIEW
- Rating
- BBB–
- Standalone
- bbb+
- Outlook
- Stable
Documents
Digital Competitive Book-Building And Final Spread Setting
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- 1.
All eligible brokers are allowed to gather firm indications of interest (FII) for any volume less or equal to the total bond issue, and for any coupon “spread” that belongs to the closed interval [0.5, 3.5] % p.a. (for this bond issue specific purpose, “spread” is defined here as the fixed margin – in % p.a. – that added to EURIBOR6M will result the floating coupon).
- 2.
Any FII that indicates a higher volume than the total bond issue or a spread outside the closed interval [0.5, 3.5] is considered to be void and will not be processed.
- 3.
Bidding step is 0.05 % p.a.
- 4.
Immediately upon receiving a FII, broker will register it on ePrimus.ro on a blind-brokering basis. Neither names nor any identification data of the investors and brokers will be “given-up” but to the lead manager, and to the Central Depository as the bond servicing agent prior to listing securities at the Bucharest Stock Exchange.
- 5.
Although binding and irrevocable, the submitted FII are changeable regarding merely the spread. During the entire subscription period and by using the same broker, investors are allowed to change their FII exclusively by reducing the spread.
- 6.
Immediately upon receiving any eligible change, broker will register it on ePrimus.ro by modifying the previously submitted FII.
- 7.
Upon registration, the FIIs are automatically prioritized for allotment, based on the ascending order of their spread bid. In case of tiebreak, the secondary following criterium for further prioritization is the registration time of the initially submitted FII (and not the time that any possible change of spread – as per para (5) – might have been registered for the same FII).
- 8.
At the end of the subscription period, the final spread (SFIN % p.a.) will be automatically calculated as the highest spread for which the bid-to-cover ratio reaches 1:1 consequently to the prioritization as described at para (8) above.
- 9.
If the bid-to-cover ratio belongs to the closed interval [0.35, 1.00] at the end of the subscription period, then SFIN = 3.5. If bid-to-cover is less than 0.35 at the end of the subscription period, the issue will be cancelled.
- 10.
If the bid-to-cover ratio at the end of the subscription period is higher than 1.00, the allotment will follow the prioritization rules as per para (7) above. The FII indicating SFIN bid, which qualifies for the last position on the priority list will be allotted the rest of unallotted bonds even if this FII’s ordered volume is greater than the remaining bonds volume. For this purpose, all submitted FII will be considered “all-or-any portion order” type.
- 11.
The final coupon rate to be paid to all bonds that were allotted under the above rules is: EURIBOR6M + SFIN (% p.a.).