UBS seeks to convert covered bonds due 2019, 2022 into soft bullets

By Wendy Van Sickle

Columbus, Ohio, Sept. 28 – UBS AG, London Branch began a consent solicitation for its €1 billion of series 2009-2 3.875% covered bonds due 2019 and its €1.25 billion of series 2010-2 4% covered bonds due 2022 to convert them into soft bullets.

The proposed amendments would bring the terms of the bonds into line with those “those commonly seen in the covered bond market, and as most recently issued by the issuer, to ensure ongoing cost efficiency of this funding program,” according to a bank announcement.

The bank is seeking to modify the terms of the bonds to convert them from hard bullet covered bonds, with an extended due for payment date, and consequentially to modify the covered bond swaps.

An early participation fee of 0.05% will be paid to bondholders who deliver their consents by 11 a.m. ET on Oct. 14 if the amendments are approved by the requisite majority of holders for the relevant series of notes.

Bondholders may continue to deliver consents until 11 a.m. ET on Oct. 24, although those delivering consents after the early deadline will not receive a participation fee.

UBS Ltd. (+44 20 7568 2133 or mailto:ol-liabilitymanagement-eu@ubs.com) is acting as solicitation agent. Lucid Issuer Services Ltd. (+44 20 7704 0880, Paul Kamminga, ubs@lucid-is.com) is acting as the tabulation agent.

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