Deutsche Bank Sweetens Deal to Seal Zombie Bond Tweaks

Deutsche Bank AG reached a deal to change the terms of an additional tier 1 note away from the discontinued Libor rate after sweetening the deal for bondholders.

Investors in a $1.25 billion AT1 bond voted for a proposal that will alter the rate used to calculate coupon payments to the Secured Overnight Financing Rate, or SOFR, the bank announced on Monday.

It’s a victory for Deutsche Bank because without the change, it could have been impossible for the bank to calculate the floating coupon based on the London Interbank Offered Rate, which was officially discontinued this year. There’s still ...