Crédit Agricole Assurances : Buy recommendation on the new RT1 bonds

Crédit Agricole Assurances recently completed the issuance of € 750m of RT1 Perp NC 2035 bonds. The offering attracted orders totalling € 2.4bn for an issuance amount of € 750m. The price talk began at 6.5% and was revised downwards to 6.25%.
We initiated coverage of these RT1 notes with a Buy recommendation. We had estimated the fair price at ~6%, in line with recent issuances by NN Group and Achmea, all rated 'BBB', and CASA's AT1s.
The 6.25% coupon implies a reset spread of 359bp. This is admittedly lower than the average 375bp that we calculate on the six RT1 notes callable in 2034/2035, but it is still higher than the 345bp offered by NN Group or the lowest 258/277bp of the Allianz RT1s.