Lloyds mass tender offers to hit UK covered bond liquidity

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By David Freitas
22 May 2020

Lloyds Bank decided to tender some of its covered bonds in three major currencies this week in what it called a “prudent approach” towards its liquidity base. The move could prompt more issuance in the asset class this year in an effort to refinance some of the tendered securities, but it could also decrease liquidity at the short end of the curve, given the cheaper refinancing alternatives open to banks.

Lloyds Bank this week said it was inviting investors to buy eight of its euro-denominated covered bonds, with maturities between January 2021 and September 2029.

It also tendered two dollar covered bonds, maturing November next year and July 2022, and seven in sterling, with maturities between January ...

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