Published: 18.05.2017
OneSavings Bank plc
("OSB")
Additional Tier 1 capital issuance
NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS OR OTHERWISE THAN TO PERSONS TO WHOM IT CAN LAWFULLY BE DISTRIBUTED.
OSB today announces the final terms of its issue of £60 million Fixed Rate Resetting Perpetual Subordinated Contingent Convertible Securities (the "Securities") that will qualify as Additional Tier 1 capital under Capital Requirements Directive IV (2013/36/EU) and the Capital Requirements Regulation (575/2013). The Securities will be subject to full conversion into ordinary shares of OSB in the event that its CET1 capital ratio falls below 7.00 per cent.
The Securities will bear interest from (and including) the issue date to (but excluding) 25 May 2022 (the "First Reset Date") at a rate of 9.125 per cent. per annum and in respect of each subsequent five-year period, at a reset interest rate equal to 835.9 basis points over the five-year semi-annual mid-swap rate for such period. Interest on the Securities[1] will be payable semi-annually in arrear on 25 May and 25 November in each year commencing on 25 November 2017, provided that OSB may at any time cancel any interest payment (in whole or in part) at its full discretion and must cancel interest payments in certain circumstances specified in the terms and conditions of the Securities. The Securities are perpetual securities with no fixed redemption date. OSB may, in its discretion and subject to satisfying certain conditions (including obtaining the prior approval of the Prudential Regulation Authority), redeem all (but not some) of the Securities at their principal amount outstanding plus any accrued but unpaid interest from (and including) the First Reset Date and on any interest payment date thereafter.
The Securities will be issued at 100 per cent. of their principal amount.
Settlement is expected to take place on or about 25 May 2017.
The net proceeds of the issue of the Securities will be used to further optimise the Issuer's capital stack to continue to support the general corporate purposes of the Group, including the growth of the Group's business.
Barclays Bank PLC is acting as the Sole Bookrunner and Structuring Advisor for the issue.
Andy Golding, Chief Executive Officer of OSB said: "I am delighted with the positive response to our Additional Tier 1 Capital issuance, demonstrating the strength of our balance sheet and investment proposition to debt investors."
Enquiries:
OneSavings Bank plc
Alastair Pate t: 01634 838 973
Brunswick Group
Robin Wrench / Simone Selzer t: 020 7404 5959
IMPORTANT NOTICE
This announcement does not constitute or form part of an offer to sell or the solicitation of an offer to subscribe for or otherwise acquire any securities in the United States or in any other jurisdiction. This announcement is not for distribution, directly or indirectly in or into the United States (as defined in Regulation S under the US Securities Act of 1933, as amended (the "Securities Act")). The securities referred to herein have not been and will not be registered under the Securities Act and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.
This communication is directed only at (i) persons who are outside the United Kingdom, or (ii) persons who are in the United Kingdom who are (a) persons who have professional experience in matters relating to investments falling within Article 19(5) of The Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 or (b) otherwise, persons to whom it may otherwise lawfully be directed (all such persons together being referred to as "relevant persons"). This communication is directed only at relevant persons and must not be read, acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons.
[1] Consistent with the market practice, interest payments on the Securities will be deducted from the calculation of return on equity and earnings per share, however these payments will not be deducted from the calculation of net interest margin, cost to income ratio and underlying profit before and after taxation. Accordingly, the treatment of the coupons on the existing Perpetual Subordinated Bonds classified as equity in the calculation of net interest margin, cost to income ratio and underlying profit after tax will be changed to be consistent with that of the Securities.