BNY Mellon wins record UK local gov bond deal
BNY Mellon has been appointed as trustee and paying agent on
Aberdeen City Council’s £370m transaction, the largest ever bond issued
by a local authority in the UK.
The proceeds of the issuance will be placed with the council’s
Capital Fund and used to fund capital expenditure programmes on vital
infrastructure projects in Aberdeen.
The bond also represents the first capital markets
instrument to be issued by a Scottish local authority.
BNY Mellon will also act as calculation agent, common depository and tax administration agent throughout the life of this deal until final maturity 2054.
HSBC assumed the role of both sole arranger and bookrunner.
The semi-annual coupon rate on Aberdeen City Council’s
issuance is linked to the performance on the UK Retail Price Index (RPI), which
includes mortgage interest payments.
“BNY has acted on two
out of three UK local authority capital raisings and we are also paying agent
on the majority of housing association bonds in the UK,” said Tom Ahern, head
of corporate trust for EMEA at BNY Mellon.
Aberdeen City Council recently secured a credit rating
from Moody’s of Aa2.
Found this useful?
Take a complimentary trial of the FOW Marketing Intelligence Platform – the comprehensive source of news and analysis across the buy- and sell- side.
Gain access to:
- A single source of in-depth news, insight and analysis across Asset Management, Securities Finance, Custody, Fund Services and Derivatives
- Our interactive database, optimized to enable you to summarise data and build graphs outlining market activity
- Exclusive whitepapers, supplements and industry analysis curated and published by Futures & Options World
- Breaking news, daily and weekly alerts on the markets most relevant to you