KfW's 10-year Euro Benchmark Bond gets off to flying start

Frankfurt (ots) - Today KfW has issued a EUR 5 billion bond with a
maturity of ten years under its Euro Benchmark Programme. The first
Euro bond issued by KfW in the new year has met with strong interest
- particularly from central banks and European banks.

The Euro Benchmark Bond I/2010 matures on 20 January 2020, pays a
coupon of 3.625% p.a. and carries a re-offer price of 99.934 (with a
3.633% yield). This corresponds to a yield pick-up of 32.9 bp over
the German government bond which matures in January 2020. The
transaction was lead managed by Credit Suisse, Deutsche Bank and
HSBC. The bond has received the same top-notch ratings (AAA/Aaa/AAA)
from Fitch Ratings, Moody's and Standard & Poor's as all KfW bonds.

"Our optimistic expectations at the beginning of the year with
regard to the market environment for KfW bonds have been exceeded",
commented Dr Günther Bräunig, member of the Managing Board of KfW
Bankengruppe in charge of capital markets. "With our 4 billion
US-dollar bond issued on the first trading day of the new year, a
600 million Sterling Bond and this 5 billion EUR Benchmark Bond we
had a good start and were able to benefit from the positive
appreciation of the Federal Republic of Germany".

Traditionally, the start of the new year is marked by strong
demand from institutional investors, but likewise by a large offer of
European government bonds in particular. Within a matter of hours
after our order book was opened on Monday, the order volume grew to
EUR 5 billion, so the initial price indication in the range of 18 to
20 basis points over the swap curve was adjusted to 18 basis points.
On Tuesday morning the order book was closed with a volume of around
EUR 8.5 billion.

With a share of around 70% banks and central banks played a
decisive role in the bond issue, for which 360 individual orders were
ultimately received. The stabilising demand from large central banks,
which had already become apparent at the end of 2009, has thus
continued.

The breakdown of the order book is as follows:

Breakdown by investor type:
Banks: 57%
Funds: 19%
Central banks: 12%
Insurance companies: 6%
Others: 6%

Geographical breakdown:
Europe: 86%
Germany 54%
Great Britain 12%
France 9%
Switzerland 5%
Benelux 2%
Italy 2%
Other 2%

Asia: 12%
Americas: 2%

For 2010 KfW has announced funding requirements of around EUR 70
to 75 billion. Nearly half of this volume is to be raised through the
issuance of large-volume euro and US dollar Benchmark bonds.

This press release is not an offer of securities for sale in the
United States. Securities may not be offered or sold in the United
States absent registration or an exemption from registration. KfW has
registered the securities that are the subject of this press release
for sale in the United States. The offering of the securities in the
United States will be made by means of a prospectus that may be
obtained from KfW and will contain detailed information about KfW and
its management, financial statements and information about the
Federal Republic of Germany.

Term Sheet
KfW Euro Benchmark I/2010
3.625 % - due 20 January 2020
ISIN: DE000A1CR4S5
Issuer: KfW
Guarantor: Federal Republic of Germany
Rating: AAA (Fitch Ratings)/ Aaa (Moody's) /
AAA (Standard & Poor's)
Size: EUR 5,000,000,000
Maturity: 19 January 2010 - 20 January 2020
Coupon: 3.625 % p.a.
Re-offer price: 99.934
Yield: 3.633 % p.a.
Format: Global Listing: Frankfurt

Lead Manager:
Credit Suisse
Deutsche Bank
HSBC

Senior Co-Lead Manager:
Commerzbank
Deka Bank
DZ Bank
Landesbank Baden-Württemberg
Unicredit (HVB)

Co-Lead Manager:
Banca Akros Gruppo BPM
Barclays
BNP Paribas
BofA Merrill Lynch
Calyon
Citi
Danske Bank A/S
Société Générale Corporate & Investment Banking

Selling Group:
Fortis
ING
Natixis
Nomura
Nordea Bank Danmark A/S
RBC
Santander
SEB

Originaltext: KfW
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For further informations please contact:

Nathalie Drücke
KfW, Palmengartenstraße 5-9, 60325 Frankfurt
Kommunikation (KOM)
Tel.: 069 7431-2098, Fax: 069 7431-3266,
E-Mail: Nathalie.Druecke@kfw.de, Internet: www.kfw.de