mBank has completed the first issuance of euro-denominated Additional Tier 1 instruments on the Polish market. The bank raised EUR 250 million, while peak demand during the book-building process exceeded EUR 2.2 billion. The final orderbook reached approximately EUR 1.75 billion, seven times the issue size. The transaction strengthens mBank's capital base and increases its capacity to finance further growth in line with its "Full Speed Ahead" strategy for 2026-2030.
Key information
mBank is the first Polish bank to complete an issuance of euro-denominated Additional Tier 1 instruments.
The issue size was EUR 250 million.
Peak demand exceeded EUR 2.2 billion.
The final orderbook reached approximately EUR 1.75 billion, seven times the issue size.
The coupon was set at 6.625%, payable semi-annually.
Strong investor demand enabled the bank to tighten pricing by 50 basis points during the book-building process.
Orders were placed by 135 investors, with the bonds allocated to 89 accounts.
The issuance opens the euro-denominated AT1 market to Polish banks.
On 22 September 2026, mBank completed the subscription for AT1 bonds with an aggregate nominal value of EUR 250 million. Orders were placed by 135 investors for a total of 17,471 bonds. The instruments were ultimately allocated to 89 investors.
The bonds were structured as perpetual instruments, callable by the bank after five years, subject to the required regulatory approvals. From the issue date until 29 March 2032, the bonds will bear interest at a fixed rate of 6.625%. Thereafter, the interest rate will be reset every five years based on the prevailing five-year EUR swap rate plus a margin of 330.8 basis points. The bonds have been assigned a BB- rating by Fitch Ratings.
Subject to regulatory approval, AT1 instruments qualify as Additional Tier 1 capital. They provide capital supporting the continued growth of the bank's lending activities.
How strong was investor demand for mBank's AT1 issuance?
The book-building process was completed in less than four hours. Peak demand exceeded EUR 2.2 billion. Demand remained strong even after pricing was tightened by 50 basis points, from the initially indicated level of approximately 7.125% to the final coupon of 6.625%. The final orderbook reached approximately EUR 1.75 billion.
The transaction attracted broad participation from international institutional investors. The scale of demand enabled the bank to combine competitive capital costs with a more diversified investor base.
The strong international demand also reflects Poland's growing economic significance. Poland has become one of the world's 20 largest economies and is increasingly being recognised as a mature, developed economy. As Polish companies expand internationally, their financing needs are also becoming more global. This creates a natural role for Polish banks in connecting domestic growth ambitions with international capital markets.
Pascal Ruhland, vice-president of the management board, chief financial officer, mBank.
This is a landmark transaction both for mBank and for the market as a whole. We are the first Polish bank to raise AT1 capital in euros, reaching a broad group of international institutional investors. The seven-times oversubscription demonstrates their confidence in the execution of mBank's strategy, its financial strength and long-term prospects. It also reflects Poland's growing economic significance. Poland is now one of the world's 20 largest economies, while Polish companies are increasingly expanding internationally and need financial partners capable of supporting their ambitions at home and abroad. The issuance strengthens our capital base and provides us with additional capacity for further, prudent growth. We want to grow together with our clients and increase the financing we provide to Polish companies and households - said Pascal Ruhland, vice-president of the management board, chief financial officer, mBank.
Why is the euro-denominated AT1 issuance a landmark transaction for the Polish market?
This is another pioneering capital markets transaction completed by mBank. In December 2024, mBank became the first commercial bank in Poland to offer PLN-denominated AT1 bonds to a broad group of institutional investors. The value of that issuance was PLN 1.5 billion.
The euro-denominated issuance enabled mBank to access a significantly larger and more liquid market of institutional investors. It also established the first international pricing reference point for euro-denominated AT1 bonds issued by a Polish bank.
Karol Prażmo, managing director of treasury and investor relations at mBank
"Following the first broadly distributed PLN-denominated AT1 issuance, we have taken another step and opened the euro-denominated market for such instruments to Polish banks. Demand was very strong from the outset and remained high even after the significant tightening of pricing during the book-building process. This is particularly important as we completed the transaction at a time of increased investor attention around Poland's creditworthiness. In the case of AT1 instruments, investors conduct a very thorough assessment of the individual issuer, including its resilience, capital position and prospects. The outcome of the issuance shows that mBank presented the market with a compelling case. The bank is growing strongly again, consistently strengthening its financial position and has room to pursue ambitious business objectives. We expect this issuance, like our previous pioneering transactions, to facilitate access to the international capital markets for other Polish banks" - said Karol Prażmo, managing director of treasury and investor relations at mBank.
How does the AT1 issuance support the delivery of the "Full Speed Ahead" strategy?
The issuance forms part of mBank's active management of its capital and funding structure. Under its "Full Speed Ahead" strategy for 2026-2030, the bank intends to maintain its Common Equity Tier 1 ratio at least 2.5 percentage points above the regulatory requirement. It also plans to more than double the value of its capital markets transactions compared with the 2020-2025 period.
A strong capital position is intended to support the continued growth of mBank's business. One of its strategic objectives is to increase its market shares in key products to at least 10%. The strategy also includes the further development of investment and international banking, as well as the continued use of capital and debt instruments to strengthen the bank's balance sheet.
The euro-denominated AT1 issuance complements mBank's international capital markets toolkit, which includes senior preferred and senior non-preferred bonds, Tier 2 instruments and AT1 bonds.
The Joint Lead Managers for the issuance were Commerzbank, Erste Group, Goldman Sachs, J.P. Morgan and UBS. The bonds will be admitted to trading on the regulated market of the Luxembourg Stock Exchange.
