UOB on Friday (Sep 6) said it priced £750 million (S$1.3 billion) of floating rate covered bonds due 2027, under the bank’s US$15 billion global covered bond programme. The bonds are expected to be issued on Sep 13.
The bonds were priced at the Sterling Overnight Index Average (Sonia) rate plus 53 basis points. It is the largest order book for UOB in British-pound covered bonds.
The Sonia rate is the average of the interest rates that banks pay to borrow the pound sterling from other financial institutions and institutional investors overnight.
The bonds are expected to be rated “Aaa” by Moody’s Investors Service, and “AAA” by Standard & Poor’s Rating Services.
The bank said it aimed to take advantage of the strong demand for front-end covered bonds, which appealed to institutional investors in the current macro environment.
Year to date, the issuance is the tighest priced three-year British pound Sonia-covered bond out of Singapore in 2024, UOB noted.
Shares of UOB were trading 0.5 per cent or S$0.15 lower at S$31.58 at the opening bell on Friday, after the announcement.
