- The CHF 375 million bond is digital only, and will be issued on the blockchain-based platform of SIX Digital Exchange (SDX) while being dually listed and traded on SDX and SIX Swiss Exchange (SIX)
- World’s first public benchmark bond that investors can access in both digital and traditional markets
- First digital bond issued by a banking institution globally to be listed, traded and settled on a regulated digital exchange
UBS AG is pricing its inaugural senior unsecured digital bond, a 375 million Swiss franc-denominated three-year bond with a 2.33% coupon (ISIN: CH1228837865).
The digital bond has the same instrument structure, legal status and rating as a traditional UBS AG senior unsecured note, but is the first digital bond by a banking institution globally that will be listed, traded and settled on a regulated digital exchange.
#News UBS launches inaugural digital bond on the #SDX platform! We are closer and closer to a full #DMI in # Switzerland. ▶️ https://t.co/hs49zhq5sy #digitalasset # Exchange pic.twitter.com/TQVKxfVC8F
– Six Digital Exchange (@SDX_global) November 4, 2022
Through this bond, UBS enables investors, regardless of whether they have the blockchain infrastructure, to invest in a digital bond. This removes a hurdle on the way to adopt new disruptive technology that can make the issuance of bonds faster, more efficient and simpler.
Beatrice MartinUBS Group Treasurer, said: “We are proud to leverage distributed ledger technology to launch the inaugural UBS Digital Alliance. This shows our commitment to supporting the development of new financial market infrastructure. UBS is committed to using technology not just as an enabler , but to make it a true differentiator for UBS.
The digital bond settles through SIX Digital Exchange (SDX) distributed ledger-based central securities depository (CSD) network through atomic settlement technology. Settlement through SDX CSD is instant and automatic and does not require a central clearing counterparty. Investors will have the ability to automatically settle and clear the UBS digital bond on either SDX CSD directly or on SIX SIS through the operational link that was formally announced on October 3, 2022.
The digital bond will be dual-listed on SDX Trading and SIX Swiss Exchange and will be eligible for the Swiss Bond Index (SBI) alongside all other UBS AG senior unsecured notes listed on SIX.
It’s 2022 and somehow most fixed income markets are still opaque, illiquid, slow and oligopolistic. Bonds are a clear use case for blockchain as a settlement layer, and there should be a way for developments like this in the US. https://t.co/OFAdJoIq8r
— Brett Harrison (@BrettHarrison88) November 3, 2022