Shinhan Bank issued a 600 million euro green covered bond, increasing the deal size from its initial target on the back of demand from European investors.

Shinhan Bank said on Monday it issued a 3.5-year, 600 million euro green covered bond worth about 944.4 billion won.

The bond is rated Aaa by Moody's and AAA by Fitch, with an annual coupon rate of 3.4116 percent. The final issue yield was set at 19 basis points over the mid-swap rate, a benchmark for euro-denominated bonds.

Ahead of the issue, Shinhan Bank held investor roadshows in major European cities including London, Munich, Luxembourg and Copenhagen, briefing investors on its financial status, covered bond programme and ESG strategy.

In bookbuilding, total orders reached 1.9 billion euros, about 3.8 times the initial 500 million euro target. Shinhan Bank increased the final deal size to 600 million euros to reflect demand.

In the pricing process, it set the issue yield at MS plus 19 basis points, 7 basis points lower than the initially indicated spread.

By region, pan-European investors took the largest share at 50 percent, followed by Britain at 37 percent and other regions including Asia at 13 percent. By investor type, asset managers accounted for 43 percent, banks 28 percent, central banks and public institutions 18 percent, and others 11 percent.

A Shinhan Bank official said, "Through the European roadshow we confirmed demand from global investors." The official added, "We will strengthen our issuance base in the euro covered bond market and expand our global investor base through the issuance of ESG-linked bonds."