Published: 2018-11-28 07:00:00 CET
LHV Group
Company Announcement

Outcome of Subscription to AS LHV Group Subordinated Bonds

Public offering of AS LHV Group subordinated bonds ended yesterday, on 27 November. Since the initial issue volume of EUR 16 million was oversubscribed, LHV used its right to increase the issue volume within the maximum permitted volume, to EUR 20 million.

Altogether 1,664 investors participated in the issue, subscribing to subordinated bonds for a total of EUR 51.147 million, that is, the initial issue volume was oversubscribed 3.2 times. The subscription period started at 10.00 on 14 November and ended at 16.00 on 27 November.

The Supervisory Board of LHV Group decided to allocate the subordinated bonds so that all subscriptions up to the threshold of EUR 10,000 were fulfilled and the remaining bonds were allocated based on the following principles:

  1. LHV’s previous investors, whose subscriptions exceeded the threshold, were allocated 40.00% of the amount exceeding the threshold;
  2. LHV’s previous customers, whose subscriptions exceeded the threshold, were allocated 15.00% of the amount exceeding the threshold;
  3. New investors, whose subscriptions exceeded the threshold, were allocated 7.65% of the amount exceeding the threshold;
  4. New non-customer professional investors, whose subscriptions exceeded the threshold, were allocated 3.00% of the amount exceeding the threshold.

All subscription orders of the same subscriber were summed up. The number of bonds with decimal places was rounded to the previous whole number.

Out of the 1,664 subscribers 73% received bonds in the desired volume. 27% of investors were allocated less bonds than they desired.

According to Madis Toomsalu, CEO of LHV Group, the results of subscription to LHV subordinated bonds were as good as expected. "The volume of subscription was the largest yet compared to our previous capital raising. Oversubscription of the first offering within the EUR 45 million bond programme was 3.2 times, which is why we decided to increase the issue volume to EUR 20 million, from EUR 16 million. The subscription was broad-based and close to 1,700 subscribers participated in it. As regards the allocation of bonds, we wanted to see all subscribers as our investors, however we preferred the existing securities’ owners and customers of LHV, nevertheless we also partially satisfied the subscriptions of all other interested investors. All in all 68% of new bonds went to existing investors, 22% went to our clients and 10% were allocated to new investors,” Madis Toomsalu commented.

LHV will use the subordinated capital raised from investors for expanding business volumes of LHV Group within the own funds and if possible, for early redemption of the existing bonds.

The offering is the first part of the previously accepted bond programme. Under the programme, LHV intends to issue subordinated bonds worth up to EUR 45 million within several issues.

The first issue of LHV includes 10-year subordinated bonds with a nominal value of EUR 1,000, annual interest rate of 6.0% and redemption date of 28 November 2028. The bonds will be transferred to the investors’ securities accounts on 30 November 2018, will be listed and admitted to trading on the Baltic Bond List of Nasdaq Tallinn Stock Exchange on 3 December 2018.

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group's key subsidiaries are LHV Pank and LHV Varahaldus. There are 380 people working at LHV and more than 156,000 clients are using its banking services. Pension funds managed by LHV have more than 177,000 clients.


Priit Rum
Communication Manager
Phone: +372 502 0786