UOB Prices Record GBP 750 Million Three-Year Covered Bond

UOB successfully priced a GBP 750 million three-year covered bond at the SONIA Rate plus 53 basis points. This marks the largest orderbook for UOB in GBP covered bonds and saw strong demand from investors. It's the tightest priced 3-year GBP SONIA bond out of Singapore.

PRNewswire Singapore, September 6: UOB has successfully priced a GBP 750 million three-year covered bond, set to mature in 2027. The bond was priced on Thursday (5 Sep) at the Sterling Overnight Index Average (SONIA) Rate plus 53 basis points. This transaction represents the largest orderbook for UOB in GBP covered bonds.

UOB has become the first non-UK bank to enter the GBP covered bond market post-summer, taking advantage of strong demand for such financial instruments. This three-year covered bond captured the interest of investors in the current macroeconomic landscape, attracting significant interest from real money fund managers, insurance companies, and bank treasuries. Koh Chin Chin, Head of Group Treasury, Research and Customer Advocacy at UOB, expressed satisfaction with the return to the covered bond market and the robust investor response.

The offering achieved a rare feat with this GBP covered bond, allowing UOB to tighten pricing and upsize the transaction. The bond's tight pricing underscores UOB's solid credit quality, coming in 2 basis points inside of pre-summer supply from the region. Notably, this covered bond is the tightest-priced 3-year GBP SONIA covered bond from Singapore and matches the tightest 3-year GBP SONIA covered bond issued so far in 2024.

The final orderbook exceeded GBP 1 billion from 20 investors, with UK investors accounting for 81%, Asia for 18%, and others for 1%. In terms of investor demand, banks made up 51%, fund managers 31%, central banks/official institutions/insurance companies 11%, and others 7%.

(With inputs from agencies.)