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Bank of Scotland begins tender offers for four series of covered bonds
By Toni Weeks
San Luis Obispo, Calif., Nov. 25 - Bank of Scotland plc announced the launch of any and all cash tender offers for four series of its euro or sterling covered bonds, according to a company notice with the London Stock Exchange.
The bank said that the tender offer will help Lloyds Banking Group plc manage its overall wholesale funding position and better optimize its stock of outstanding debt securities while maintaining a prudent approach to liquidity.
The company will accept tenders for its outstanding €2 billion of 3.875% covered bonds due January 2014, €2 billion of 4.25% covered bonds due September 2014, £316 million of fixed-to-floating-rate covered bonds due December 2014 and €2 billion of 4.75% covered bonds due January 2015.
The purchase price for the 3.875% bonds will be €1,004.25 per €1,000 principal amount of notes if settlement occurs on the expected Dec. 6 settlement date. The purchase price for the fixed-to-floating bonds will be €1,000.77 per €1,000 principal amount.
The purchase price for the 4.25% bonds and 4.75% bonds will be based on reference to a fixed spread of zero basis points over a benchmark security, which is the 2.5% German government bonds due October 2014 for the 4.25% bonds and the 3.75% German government bonds due January 2015 for the 4.75% bonds.
The offers will expire at 11 a.m. ET on Dec. 2. Pricing will be set at 5 a.m. ET on Dec. 3, and settlement is expected Dec. 6.
Lucid Issuer Services Ltd. (44 20 7704 0880 attn: Sunjeeve Patel / Paul Kamminga or e-mail: bos@lucid-is.com) is the tender agent. BNP Paribas (44 20 7595 8668 attn: liability management group or e-mail: liability.management@bnpparibas.com) and Lloyds Bank plc (44 20 7158 3981 attn: liability management group or e-mail: liability.management@lloydsbanking.com) are the dealer managers.
Bank of Scotland is based in Edinburgh.
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