OneSavings Bank PLC: Interest Rate Reset - 6.591% Perpetual Subordinated Bonds

22.January 2016 at 17:10:45 CET

OneSavings Bank plc

("OSB or the "Company")

Interest Rate resetting on the 22,000,000 6.591% Perpetual Subordinated Bonds (the "Bonds")

Key points:

  • In accordance with the terms of the Bonds the interest rate payable on the Bonds is subject to a resetting process from time to time, with the next reset becoming effective from and including 7 March 2016
  • Following the procedure set out in the terms of the Bonds, the interest rate has today been reset by OSB's appointed Agent Bank, Canaccord Genuity Limited ("Canaccord").
  • The revised rate of interest which shall be payable from and including 7 March 2016 is 4.5991%
  • This rate will remain the effective rate payable on the Bonds until the next reset of interest rates is due to take effect, which will be on the fifth anniversary of 7 March 2016

Interest Rate Reset

OSB, the UK bank formed out of the business of the former Kent Reliance Building Society and which listed on the Main Market of the London Stock Exchange in June 2014, has today announced the result of the interest resetting process applicable to its 22,000,000 6.591% per cent Perpetual Subordinated Bonds.

Under the terms of the Bonds, the interest rate applicable to the Bonds, originally set at 6.591%, is due to be reset with effect from 7 March 2016 and thereafter on each fifth anniversary of that date.

The procedure for resetting the interest rates is set out in the terms and conditions of the Bonds and involves OSB's appointed Agent Bank fixing the rate by reference to the gross yield to redemption applicable on a Benchmark Gilt chosen by the Agent Bank.  Cannacord has been appointed as the Agent Bank for these purposes and chose as the Benchmark Gilt the 1.5% UK Treasury Gilt 01/2021.

Following the methodology set out in the terms and conditions of the Bonds, the Agent Bank has determined the Gross Redemption Yield applicable on the Benchmark Gilt to be 1.1991%.  The terms and conditions of the Bonds require the interest rate on the Bonds to be set at the rate of 3.4% per annum plus the gross redemption yield on the Benchmark Gilt.  Accordingly, it has determined the new rate of interest as being 4.5991% per annum. This rate will apply to the Bonds from and including 7 March 2016.

For further information please contact:

Zoe Bucknell, Group General Counsel and Company Secretary                   t: 01634 835788

Alastair Pate, Group Head of Investor Relations                                                 t: 01634 838973

About OneSavings Bank plc

OneSavings Bank plc ('OSB') began trading as a bank on 1 February 2011 when the trade and assets of Kent Reliance Building Society ('KRBS') were transferred into the business. OSB is a specialist lending and retail savings group authorised by the Prudential Regulation Authority, part of the Bank of England, and regulated by the Financial Conduct Authority and Prudential Regulation Authority.

OSB focuses on selected sub-sectors of the lending market in which it has established expertise, platforms and capabilities, and where opportunities have been identified for both high returns on a risk-adjusted basis and strong growth. These include Residential Mortgages (comprising first charge, second charge and shared ownership), Buy-to-Let/SME and Personal Loans. OSB originates organically through specialist brokers and independent financial advisors.

OSB is predominantly funded by retail savings originated through the established Kent Reliance franchise, which includes a network of branches in the South East of England, as well as online and postal channels. Diversification of funding is currently provided by a securitisation and OSB joined the Funding for Lending Scheme in early 2014.