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15 May 2018
SYNDICATED LAUNCH OF £6.0 BILLION NOMINAL OF 1⅝% TREASURY GILT 2071: RESULT
The United Kingdom Debt Management Office (DMO) announces that the syndicated launch of £6.0 billion (nominal) of 1⅝% Treasury Gilt 2071 has been priced at £97.615 per £100 nominal, equating to a gross redemption yield of 1.693%. The transaction will settle, and the first tranche of this gilt will be issued, on 16 May 2018.
Proceeds from today’s transaction are expected to amount to approximately £5.8 billion (cash1). This was the first transaction of the DMO’s 2018-19 syndication programme, which was initially planned to raise a minimum of £18.0 billion (£9.5 billion of long conventional gilts in two transactions and £8.5 billion of index-linked gilts in two transactions).
The offering was priced at a yield spread of 0.5 basis points (bps) below the yield on 3½% Treasury Gilt 2068, 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.
The syndication programme and the unallocated issuance amount
Given the strength and quality of core demand at this transaction, the DMO has decided to increase the size of the syndication from the initially planned amount. Accordingly the DMO has moved £1.0 billion (cash) from the unallocated issuance amount to the long conventional syndication programme (increasing the minimum size of that programme to £10.5 billion and the minimum overall size of the syndication programme to £19.0 billion).
1 Figures in this Press Notice are in cash terms unless indicated otherwise.