Eurobank raised €600 million through a seven-year green senior preferred bond on Tuesday, with the issue 2.8 times oversubscribed as investors responded strongly to the bank’s latest debt offering.

The bond, which can be called by Eurobank after six years, was priced at a spread of 98 basis points over the mid-swap rate.

Initial guidance had placed the pricing at around 125 basis points above mid-swap, implying a yield of approximately 4.54 per cent.

The strong demand allowed the bank to tighten the spread substantially before completing the €600 million issue.

The bond is expected to receive ratings of Baa1 from Moody’s, BBB- from S&P, BBB from Fitch and BBBH from Morningstar DBRS.

The transaction forms part of Eurobank’s strategy to meet and strengthen its Minimum Requirement for own funds and Eligible Liabilities (MREL) position by raising eligible capital through international markets.

Barclays, Commerzbank, HSBC, Natixis and Société Générale are acting as joint bookrunners on the transaction.

The issue also builds on Eurobank’s previous activity in the green senior preferred debt market.

The bank made its first comparable green senior preferred issue in 2024, raising €850 million through the transaction.

The latest bond follows Eurobank’s recent update of its Green Bond Framework, which establishes the criteria under which the bank can raise funds from capital markets to finance environmentally sustainable investments.

The updated framework provides the basis for the bank’s latest move into the green debt market and sets out which projects can receive financing, the criteria used to select them and how the use of proceeds will be monitored.

It is the second update to the framework since its original introduction in 2021, incorporating experience gained from the €850 million green bond issued in 2024.

Eligible investments under the framework are divided into five main areas, covering energy efficiency, renewable energy, clean transport, green buildings, and sustainable water and wastewater management.

The framework also contains exclusions covering activities including weapons, tobacco, alcohol, gambling and radioactive materials, as well as certain activities linked to the exploitation of natural resources.

Eurobank has committed to publishing an annual report on the allocation of the proceeds, while the process is subject to external assessment and independent verification.