Volkswagen’s financial services division has raised €2bn (£1.75bn) through the issue of three bonds, two months after the last such transaction by the company.
The bonds were issued by Volkswagen Bank, the subsidiary which took on European credit and deposit operations following a realignment within VW in September.
In April, Volkswagen Financial Services (VWFS), which maintains responsibility for the leasing, fleet and mobility businesses, raised €3bn in two distinct bond issues.
The company expected rating agencies Moody’s and Standard & Poor’s to assign ratings of BBB+ and A3 to Wednesday’s issue, in line with April’s. VW said the issue was two-and-a-half times oversubscribed.
Wednesday’s issue is the first for Volkswagen Bank since last year’s reorganisation, which was prompted by EU capital regulations, was well-received by rating agencies.
The restructuring led Moody to upgrade the outlook for VW’s financial services division from negative to stable, citing expectations of greater support for the division from the main company.
The rating agency has subsequently expressed concerns around the division’s exposure to diesel residual values.
In May, Volkswagen reported good growth in financial services for Q1. The number of new contracts was up 8.8% year-on-year, to just under 2m.
The main group reported a fall in operating profits for the quarter, down 4,7% to €4.2bn, despite a 3.5% rise in revenues to €58.2bn.
The carmaker attributed the fall in profits to a change in reporting requirements.