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TORONTO, April 23, 2024 /CNW/ - Equitable Bank (the "Bank" or "Equitable"), Canada's Challenger Bank™, is pleased to announce that it has completed its largest-ever offering of €500 million (CAD $735 million) in legislative covered bonds (the "bonds") due May 28, 2027. The bonds were issued under the Bank's CAD $3.0 billion Global Legislative Covered Bond Programme and represent Equitable's first issuance of a social bond under its Sustainable Bond Framework.

Equitable Bank believes in supporting its communities beyond the provision of financial services. Social bond issuance is a natural extension of the Bank's sustainable business practices that enables it to further support lending activities with a social benefit. In particular, housing in Canada is a complex issue, with rising costs and a lack of affordable options for many individuals and families. Equitable Bank structured this covered bond to focus on social and affordable housing, in recognition of the pervasive challenges of the housing landscape in Canada and with an eye on ensuring adequate and affordable housing.

"We're thrilled to mark twin milestones with this issuance as it represents Equitable Bank's largest-ever covered bond offering and the first-ever issuance of a social covered bond by a Canadian bank. Issuing in this size expands our available investor base to include those seeking the enhanced liquidity that benchmark issuances demonstrate, and the record-setting interest reflects growing global appetite for Equitable Bank's unique challenger story," said Chadwick Westlake, chief financial officer. "We're delighted that investors and rating agencies continue to respond positively to the success we've had in diversifying our funding sources, including growing our direct-to-consumer EQ Bank presence and expanding our wholesale funding program. We're invigorated that Fitch recently upgraded its assessment of both our risk profile and funding and liquidity profile."

The 3-year €500 million social covered bonds are rated AA by Fitch and Morningstar DBRS and were issued at a spread of 58 bps over the Euro mid-swap rate. Approximately two-thirds of the 100+ investors were new to Equitable Bank's Covered Bond Programme, and the total order book exceeded €4 billion and was oversubscribed by more than 8x times. Inclusive of all costs, covered bonds remain the lowest cost of wholesale funding available to the Bank.

The bonds are listed on the Irish Stock Exchange (Euronext Dublin) and represent the Bank's fifth issuance since Canada Mortgage and Housing Corporation (CMHC) approved the creation of the Bank's Covered Bond Programme in July 2021, bringing total outstanding to €1.7 billion (CAD $2.4 billion). All proceeds from the Bank's covered bond issuances are converted to CAD, with no residual foreign exchange or interest rate risk exposure retained.

The issuance was completed with Barclays, DZ BANK, Erste Group, LBBW, RBC Capital Markets, Scotiabank and TD Securities acting as joint bookrunners.

In the United Kingdom, this announcement is being distributed only to, and is directed only at, persons who: (A) (i) are "investment professionals" specified in Article 19(5) of the Financial Services and Markets Act (Financial Promotion) Order 2005 (the "Order") or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order or (iii) are other persons to whom it may otherwise lawfully be communicated; and (B) are "qualified investors" within the meaning of Article 2(e) of Regulation (EU) 2017/1129 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018 (all such persons together being referred to as "Relevant Persons"). In the European Economic Area (the "EEA"), this announcement is addressed only to and directed only at, persons in member states who are "qualified investors" within the meaning of Article 2(e) of Regulation ((EU) 2017/1129 ("Qualified Investors"). This announcement must not be acted on or relied on (i) in the United Kingdom, by persons who are not Relevant Persons, and (ii) in any member state of the EEA, by persons who are not Qualified Investors. Any investment or investment activity to which this announcement relates is available only to: (i) in the United Kingdom, Relevant Persons; and (ii) in any member state of the EEA, Qualified Investors, and will be engaged in only with such persons.

Equitable Bank has a clear mission to drive change in Canadian banking to enrich people's lives. As Canada's Challenger Bank™ and seventh largest bank by assets, it leverages technology to deliver exceptional personal and commercial banking experiences and services to over 607,000 customers and more than six million credit union members through its businesses. It is a wholly owned subsidiary of EQB Inc. (TSX: EQB and EQB.PR.C), a leading digital financial services company with $119 billion in combined assets under management and administration (as at January 31, 2024). Through its digital EQ Bank platform (eqbank.ca), its customers have named it one of Canada's top banks on the Forbes World's Best Banks list since 2021.

To learn more, please visit eqb.investorroom.com or connect with us on LinkedIn.

David Lee
Associate Director, Investor Relations
[email protected] 

Maggie Hall
Director, PR & Communications
[email protected] 

SOURCE Equitable Bank

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