Demand for the Lithuanian Central Credit Union Subordinated Bonds Exceeded Supply by More Than EUR 1.5 Million
The Lithuanian Central Credit Union (LCKU), which unites the country’s largest network of credit unions – the LKU group – has completed the placement of its subordinated bond issue. Investor demand exceeded supply by EUR 1.5 million: applications were submitted for more than EUR 5.5 million, although the issue size was limited to up to EUR 4 million. The bonds were issued under a programme of up to EUR 8 million and will be admitted to trading on NASDAQ’s alternative market First North.
The bonds worth 4 million euros were issued with an annual interest rate of 8.25%. The placement was organised by the investment firm Orion Securities.
According to Mindaugas Vijūnas, Chairman of the Board and CEO of LCKU, which brings together 44 credit unions in Lithuania, these results confirm that the country’s credit union sector is viewed by investors as a mature, transparent, and professionally managed financial system.
“Most investors in the auction chose an annual interest rate of 8%, which is a clear signal that market participants assess our credit risk favourably and justifiably consider us a reliable and stable partner in the current economic environment. Demand exceeding expectations demonstrates that LCKU is perceived as a financially resilient institution that consistently strengthens its capital and ensures sustainable growth of the entire sector,” says M. Vijūnas.
Institutional and Experienced Investors Dominated
“The placement results indicate a balanced demand structure between institutional and retail investors: institutional investors accounted for 38% of total demand, while retail investors made up 62%. Eighty-five percent of investors were from Lithuania, 11% from Estonia, and the remainder from Latvia.
Eighty-one percent of the funds raised came from institutional and more experienced retail investors with investments starting from EUR 10,000. This was driven by the longer bond maturity, which better meets the expectations of professional investors and reflects their understanding of the advantages of the cooperative financial model,” comments Mykantas Urba, Head of Investment Banking at Orion Securities.
All investment orders from LKU group credit union members who submitted applications of up to EUR 10,000 were fully satisfied, while allocations for larger investors were proportionally reduced due to overall excess demand. This approach aims to create a diversified bond investor base balanced between retail and institutional market participants.
Sustainable Growth and Professionally Managed Risk
More than 80% of loans issued by the LKU credit union group are classified as low-risk. In the third quarter of 2025, secured loans accounted for 99.08% of LCKU’s loan portfolio, and the figure for the entire LKU group also remained exceptionally high at 95.79%.
“The funds raised will be used to strengthen LCKU’s capital and expand the credit union network so that it can more actively finance Lithuanian residents and local businesses. This contributes to the growth of the country’s financial ecosystem and strengthens regional economies, as credit unions are often the first financial partners in smaller towns and communities. Investors will become part of building a strong, responsibly supervised local financial system,” says M. Vijūnas.
All LCKU’s operational decisions are made in Lithuania, aligned with the needs of local residents and regions. The same principles guide major European cooperative financial institutions – from Germany’s Volksbanken-Raiffeisen network to the Netherlands’ Rabobank. These institutions are known for long-term stability, resilience to economic shocks, and their role as essential pillars of local economies.
Orion Securities recommends consulting with your financial advisor before making an investment decision and evaluating all risks related to securities (bonds) and/or any other circumstances that may be relevant to you.
