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21 February 2017
SYNDICATED RE-OPENING OF £2.0 BILLION NOMINAL OF 0⅛% INDEX-LINKED TREASURY GILT 2065: RESULT
The United Kingdom Debt Management Office (DMO) announces that the syndicated re-opening of £2.0 billion (nominal) of 0⅛% Index-linked Treasury Gilt 2065 has been priced at £219.833 per £100 nominal, equating to a gross real redemption yield of -1.5235%. The transaction will settle, and the third tranche of this gilt will be issued, on 22 February 2017, at which date the gilt will have £7.25 billion (nominal) in issue. Proceeds from today’s transaction are expected to amount to approximately £4.5 billion (cash1).
The offering was priced at a yield spread of 0.25 basis points (bps)2 below the yield on 0⅜% Index-linked Treasury Gilt 2062, which represented the tight end of the published price guidance. The UK domestic market provided the predominant support for the issue, taking around 90% of the allocation.
This was the seventh and final transaction of the DMO’s 2016-17 syndication programme, which raised a total of £33.0 billion (£18.4 billion of index-linked gilts in four transactions and £14.6 billion of long conventional gilts in three transactions).
Syndication programme and the unallocated supplementary amount
Given the strength and quality of demand at this transaction, the DMO has decided to allocate £0.6 billion of the unallocated supplementary issuance amount to the index-linked gilt syndication programme in 2016-17 (increasing the size of that programme to £18.4 billion and the final size of the overall syndication programme to £33.0 billion). The size of the remaining unallocated supplementary amount has accordingly been reduced to £0.7 billion.
NOTES TO EDITORS
The syndicated offer was managed by four Joint Bookrunners: Barclays, Lloyds Bank, NatWest Markets and UBS Investment Bank. All other panel member Index-linked Gilt-edged Market Makers were Co-Lead Managers. The composition of the syndicate was announced by the DMO on 10 February 2017.
0⅛% Index-linked Treasury Gilt 2065 was launched by a £2.75 billion (nominal) syndication on 23 February 2016 and was re-opened by a £2.50 billion (nominal) syndication on 26 July 2016.
This press notice will be appearing on the DMO’s website at: www.dmo.gov.uk
1 Figures in this Press Notice are in cash terms unless indicated otherwise.
2 0.25bps = 0.0025%