UOB has announced the pricing of AUD 900 million ($645 million) 5-year floating rate senior unsecured notes due 2027.
Koh Chin Chin, head of group central treasury unit, of UOB said, “Since October 2020, we have been pre-financing actively in the market ahead of macroeconomic and structural headwinds. Together with the latest print of A$900 million, we have achieved a total issuance volume of A$3.6 billion during this period. We are thankful for the strong support and repeated demand across both domestic and regional investors”.
Below are the key highlights of the transaction:
Largest single issuance for UOB in the AUD market despite volatile market conditions
• This A$900 million ($645 million) transaction is the largest single issuance for UOB and the largest for a Southeast Asian issuer.
• The transaction is also the largest ever single-tranche AUD issuance from Asia ex-Japan.
•The transaction is the tightest priced five-year foreign bank print year-to-date, even with escalating geopolitical tensions.
• UOB's issuance saw strong engagement from investors even on an accelerated 24-hour execution timeline.
• Final pricing landed at Bank Bill Swap rate (BBSW)+72 basis points, representing zero discount (new issue concessions) to the major bank curve.
Navigated volatile markets and competing supply with a flexible execution approach
• UOB executed the transaction immediately after the announcement of a strong set of full-year earnings, riding on the positive momentum and to avoid competing supply.
• UOB adopted a flexible approach to execution, offering investors the choice across both short and medium tenors as well as fixed or floating rate formats. UOB recognises that amid a crowded market with a large supply recently, there may be varying investor liquidity and preferences across the yield curve.
• As investor appetite coalesced into the five-year floating-rate note tenor, UOB opted to focus on a single tranche to maximise liquidity for investors.
One of the most strategic foreign issuers in the AUD market
• UOB has been able to attract repeated demand as one of the most frequent foreign bank issuers in the Australia market, with A$3.6 billion raised across six benchmark transactions in both public and private placements.
Strong investor following over the past decade
• UOB has garnered a strong domestic and international investor following in the AUD market, evidenced by the progressively larger volumes and orderbooks in each of our offerings.
• The consistent investor support was evident in the AU$1.16 billion orderbook, the largest achieved by the Singapore-headquartered bank. This was achieved amid market volatility and an uptick in domestic supply, due to the expected interest rate increases in the horizon and the end of the Reserve Bank of Australia (RBA)’s term-funding facility (TFF) as part of the pandemic rescue package.
Re-disseminated by The Asian Banker