KeyCorp launched a $5 billion Euronote program on Monday, making it the latest regional bank to tap foreign capital markets.

The program-KeyCorp's first-enables the company to offer senior or subordinated securities exclusively to European investors.

Note maturities range from 30 days to 30 years and will be issued from KeyCorp, the holding company; KeyBank National Association, Key's nationwide consumer and corporate bank; and Key Bank USA, National Association, Key's national consumer-finance unit, according to the company.

KeyCorp's Euronote program comes as many regional banks are looking to diversify its investor base by issuing in the Euromarkets.

Name recognition is increasingly important, according to bank bond analyst Ethan M. Heisler of Salomon Brothers Inc. "Banks have to build up a reputation and get their name known. I'd expect that the top 30 or 40 regional banks have looked at the Euromarkets because it is becoming a question of opportunity," he said.

Regional banks that have already set up Euronote programs or issued in that market include First Union Corp., Huntington Bancshares, and Norwest Corp. NationsBank Corp. and Comerica Inc. issued Eurodebt last week.

Because KeyCorp does not have the same volume of paper out in the market, analysts predict that it will initially be more expensive for the bank to issue.

Meanwhile, Long Island Savings Bank and Mercantile Bancorp are expected to issue in the U.S. capital markets this week.

Long Island Savings plans to issue its debut $1 billion note program on Tuesday. Mercantile is preparing to issue $500 million in subordinated and senior debt on Wednesday.

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