Lloyds Banking Group lists first SONIA-linked corporate bond

  • Three-year sterling benchmark floating rate covered bond tied to SONIA
  • Bond raises £750 million from institutional investors
  • First corporate bond linked to Bank of England’s new reference rate
  • Confirms London Stock Exchange’s position as a leading listing venue for fixed income products

London Stock Exchange Group (LSEG) today welcomes the listing of a new corporate bond from Lloyds Banking Group. The three-year sterling benchmark floating rate covered bond is tied to the Bank of England’s Sterling Overnight Index Average (SONIA®) and is the first such bond from a commercial organisation.The bond, which lists on London Stock Exchange today, was 1.9 times oversubscribed and raised £750 million from institutional investors.

Nikhil Rathi, CEO, London Stock Exchange Plc:

“We congratulate Lloyds Banking Group on the listing of the first corporate bond to be linked to SONIA, the Bank of England’s new reference rate. As a Group we are working closely with customers and regulators in the transition to alternative reference rates globally. London’s markets are home to a diversified portfolio of fixed income assets and we look forward to welcoming further corporate bonds linked to these new rates.”

Toby Rougier, Group Corporate Treasurer at Lloyds Banking Group:

“We are proud to be the first corporate company to issue a SONIA linked bond on London Stock Exchange, and pleased with the strong investor demand for the trade from both UK and non-UK accounts. This shows confidence in the bank and its strategy, and also interest in this new product. By continuing to innovate, the Group is well placed to continue its strong support for its customers and deliver superior returns for its shareholders, as it remains focused on its purpose of Helping Britain Prosper.”

London Stock Exchange is a leading listing venue for fixed income and there are currently over 13,500 bonds listed on our markets. As a Group, we are working with customers and regulators to help facilitate a smooth transition to new reference rates. In April, CurveGlobal, the interest rates derivatives platform, launched the innovative CurveGlobal® Three Month SONIA® Future contract, which has seen good volume growth. LCH, the global clearing house, is also clearing SOFR swaps, the new alternative US Dollar reference rate, in addition to clearing of SONIA futures and SARON swaps.

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