United Overseas Bank (UOB) intends to issue EUR750 million ($1.2 billion) covered bonds as the ninth series under its US$8 billion ($10.7 billion) Global Covered Bond Programme.
According to UOB, the covered bonds mark the longest-dated covered bond by a Singapore bank with an eight-year tenor.
The covered bonds, which are Euro-denominated, will carry a coupon of 0.01% per annum. They will be issued at 99.809% of the principal amount of the covered bonds on May 25 and will mature on May 25, 2029.
The covered bonds were priced at Euro swap +10 basis points, seven basis points cheaper than UOB’s seven-year euro covered bond transaction in November 2020, despite this issuance’s longer maturity of eight years.
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Glacier Eighty (CBG) will guarantee the covered bonds, secured by a portfolio of loans purchased by CBG from UOB and other assets of CBG.
Moody's Investors Service is expected to rate the covered bonds Aaa, while Standard & Poor's Rating Services are expected to give a AAA rating.
UOB, BNP Paribas, HSBC Continental Europe and Norddeutsche Landesbank – Girozentrale – have been appointed as lead managers.
UOB states that the final orderbook is approaching EUR800 million at reoffer from 40 accounts, with 60% of final allocations going to central banks, official institutions, and fund managers.
“We are thankful for the participation from high quality investors who have supported us through the years and are also pleased to have achieved a large issuance at attractive pricing despite the challenging market backdrop,” says Koh Chin Chin, head of group central treasury unit.
Shares in UOB closed 57 cents or 2.26% higher at $25.75 on May 18.
