Lloyds to swap out €1.35 billion of eight note series in two offers

By Susanna Moon

Chicago, Nov. 7 – Lloyds Banking Group plc said investors had tendered €1,353,568,000 of eight series of its notes in the exchange offers that ended at 11 a.m. ET on Nov. 4.

Specifically, investors had tendered €614,657,000 of notes in the exchange offer A and €738,911,000 of notes in the euro exchange offer B, according to a company notice.

Lloyds began the exchange on Oct. 27, along with a tender for any and all of five series of notes and a separate maximum tender offer for up to $2 billion of eight other series of its notes.

Investors had tendered $3,296,365,000 of five series of its notes in the any-and-all tender offer that ended at 5 p.m. ET on Nov. 3, with $18,907,000 principal amount of the notes using the guaranteed delivery procedures.

The maximum tender offer will end at 11:59 p.m. ET on Nov. 25.

Lloyds was offering to exchange up to a total of €1.5 billion of its euro A new notes. Investors had tendered for exchange the following amounts with the notes listed in priority order:

• €24,655,000 of the €750 million notes due Oct. 9, 2018 with a floating coupon of Euribor plus 50 bps at an exchange price of 100.75;

• €288,945,000 of the €1 billion 0.625% notes due April 20, 2020 at an exchange price to be set using mid-swaps plus 10 bps;

• €184,174,000 of the €1 billion 1.875% notes due Oct. 10, 2018 at an exchange price of mid-swaps flat;

• €63,902,000 of the €1.35 billion notes due Sept. 10, 2019 with a floating coupon of Euribor plus 45 bps at an exchange price of 101; and

• €52,981,000 of the €1,062,350,000 5.375% notes due Sept. 3, 2019 at an exchange price of mid-swaps flat.

The euro A new notes will have a coupon of mid-swaps plus 80 bps and a maturity of Nov. 9, 2021.

Lloyds also was offering to exchange up to total of €1.5 billion of its euro B new notes, and investors had tendered the following amounts with the notes listed in priority order:

• €185,899,000 of the €1.25 billion 1.25% notes due Jan. 13, 2025 at an exchange price of mid-swaps plus 30 bps;

• €348.82 million of the €1.5 billion 1% notes due Nov. 19, 2021 at an exchange price of mid-swaps plus 25 bps; and

• €204,192,000 of the €1.25 billion 1.375% notes due Sept. 8, 2022 at an exchange price of mid-swaps plus 30 bps.

The euro B new notes will be due Nov. 9, 2023 and will carry a coupon of mid-swaps plus 90 bps.

Each of these exchange offers was conditioned on enough notes being exchanged to result in the issue of at least €500 million of new notes from each series, but each offer was not conditioned on any minimum amount of tenders.

Holders will be issued new notes in minimum principal amounts of €100,000.

Pricing will be set at 9 a.m. ET on Nov. 7.

Settlement is expected to occur on Nov. 9.

Lloyds previously said it was tendering for the notes “in order to provide the holders of the notes with an opportunity to have their notes repurchased while maintaining a prudent approach to funding and liquidity as part of the group’s ongoing liability management.”

The tender and exchange agent is Lucid Issuer Services Ltd. (attn: David Shilson/Arlind Bytyqi, +44 20 7704 0880 or lloydsbank@lucid-is.com).

The global coordinator is Lloyds Bank (855 400-6511, 212 827-3105, +44 20 7158 2720 or liability.management@lloydsbanking.com).

The joint dealer managers of the tender offers are BNP Paribas (888 210-4358, 212 841-3059, +44 20 7595 8668 or liability.management@bnpparibas.com), Deutsche Bank Securities Inc. (866 627-0391, 212 250-2955, +44 20 7545 8011 or liability.management@db.com) and UBS Ltd. (888 719-4210, 203 719-4210, +44 20 7568 2133 or ol-liabilitymanagement-eu@ubs.com).

The banking and financial services company is based in London.

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