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Treasury & Capital Markets
UOB diversifies covered bond investor base with first sterling issue
UOB debuts in sterling market with a 350-million-sterling (US$486 million) floating rate offering
Chito Santiago 22 Feb 2018

SINGAPORE lender United Overseas Bank (UOB) returned to the covered bond market for the second time this year – this time further diversifying its investor base when it debuted in the sterling market with a 350-million-sterling (US$486 million) floating rate offering.

The five-year deal was priced at par with a coupon of 0.24% per annum over the three-month sterling Libor. This was 2bp tighter than the initial price guidance of 0.26%.

The bonds will be guaranteed as to payments of interest and principal by Glacier Eighty Private Limited. The guarantee is secured by a portfolio of loans purchased by Glacier from the company and other assets of Glacier.

Credit Suisse Securities (Europe), HSBC and UOB acted as the joint lead managers for the transaction.

This is the fifth series of bonds issued under UOB’s US$8 billion global covered bond programme. The bank issued its first covered bonds in early March 2016 with a 500-million-euro (US$617 million) transaction, which also represented the first euro-denominated covered bonds in Asia.

In another first in Asia, UOB sold in February 2017 its second covered bonds comprising two tranches – a US$500 million offering with a coupon of 2.125% and maturing in 2020, and a 500-million-euro offering paying a coupon of 0.125% and maturing in 2022.

The latest deal was actually the second covered bond offering by UOB this year, having printed a 500-million-euro issue in January. The seven-year deal was priced at 99.412% with a coupon of 0.50% per annum.

Photo: Zairon / Wikimedia

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