Subordinated Debt issuance

RNS Number : 0507S

Standard Life plc

27 November 2012

 



Standard Life plc today announced a subordinated debt issuance raising £500 million principal amount of 5.5% fixed/fixed subordinated notes with a first call date in December 2022 (the "subordinated notes").

This initiative further optimises the financial structure of the Standard Life Group and builds on past actions to re-shape its balance sheet and improve its leverage.

The strong market demand, which was evidenced by a heavily over subscribed order book, has enabled Standard Life plc to price competitively at the low end of its target range, thereby underlining the attractiveness of the Company's credit, the strength of its recent performance and its future strategic direction.

The subordinated notes will bear interest at a fixed rate of 5.5% for ten years until the call date in 2022. The subordinated notes are unguaranteed and have a legal final maturity in December 2042.

The proceeds from the debt issuance will be held for general corporate purposes and will count towards the Group's IGD (Insurance Groups Directive) surplus.  The subordinated notes have also been designed to be compliant with the requirements of Solvency 2 albeit the provisions of Solvency 2 have still to be finalised.

The subordinated notes are expected to be rated "Baa2" by Moody's and "BBB" by Standard & Poor's.

Jackie Hunt, Chief Financial Officer commented today: "As part of our active capital management programme, and building on the recent issuance of subordinated debentures in Canada, we have today taken advantage of favourable market conditions to improve the leverage position of the Standard Life Group via a subordinated debt issuance directly from our holding company. The strong order book and successful placement is a powerful signal of investors' confidence in Standard Life's financial strength and strategic plans."

The syndicate for the offering was co-led by Barclays, Deutsche Bank, Merrill Lynch, The Royal Bank of Scotland and UBS Investment Bank. The offering is expected to close on 4^th December 2012.

The subordinated notes have not been and will not be registered in the United States under the United States Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any state of the United States and may not be offered, sold or delivered, directly or indirectly in the United States or to, or for the account or benefit of, a "U.S. person" (as defined in Regulation S under the Securities Act) absent registration or an applicable exemption from such registration requirements. This press release does not constitute an offer to sell or a solicitation to buy securities in the United States and any public offering of the securities in the United States must be made by means of a prospectus.

Contact details for further information:

Scott Forrest               Group Capital Management                0131 245 6045

Nick Mardon                Group Capital Management                0131 245 6371

 

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