A £650m five year FRN for Stadshypotek today (Thursday) was held up as further evidence of the potential for international issuers to win on both spread and size in the sterling market, with the Swede able to match the spread of a five year FRN for domestic UK name Barclays just two days ago.

Following a mandate announcement yesterday (Wednesday), Stadshypotek’s deal was launched this morning by leads Credit Suisse, Nomura and RBC with initial price thoughts of the three month Libor plus 27bp area. It was ultimately priced at 22bp and the size set at £650m, on the back of more than £775m of orders.

Bankers noted that the spread matched that of a £1.25bn five year FRN for Barclays on Tuesday.

“To price in line with a domestic name, even for a smaller size, is a very impressive result,” said a syndicate banker at one of the leads. “The book is also roughly in line with the peak of the demand for yesterday’s Bank of Nova Scotia trade, which is around the upper end of the demand we’ve seen for sterling trades from international issuers.

“It demonstrates that there continues to be strong demand for both UK and non-UK paper in this market, despite the supply we’ve seen in the last few days. It’s a strong endorsement of the ability to get size and an attractive spread out of the sterling market.”

Syndicate bankers said the spread of 22bp over three month Libor represented a saving of around 2bp versus what the issuer would have been able to achieve in euros or in its domestic market.

“It’s a notable saving, and it’s noteworthy that they didn’t have to compromise on size,” added a syndicate banker away from the leads.

A syndicate banker added that the demand received by Stadshypotek was even more impressive given that UBS printed a £1bn senior unsecured three year.

“It’s extraordinarily rare to see £1bn printed in a FIG transaction, especially in the short end, and there was other sterling senior supply out there today as well,” he said. “In that context, Stadshypotek’s result was especially strong.”

The new issue is the Svenska Handelsbanken subsidiary’s first benchmark sterling covered bond since August 2015, when it priced a £300m three year FRN.