UBS will issue a digital bond that will be publicly traded on both a cryptocurrency and a traditional exchange and will have the same legal status and rating as an unsecured bond.
According to the bank, the three-year bond worth 375 million Swiss francs (about $370 million) with a coupon of 2.33% will be issued on the blockchain platform SIX Digital Exchange (SDX) and will be dual-listed on SDX and the Swiss stock exchange SIX Swiss Exchange.
“We are proud to use distributed ledger technology to launch the first UBS Digital Bond. This demonstrates our commitment to developing new financial market infrastructure,” said UBS Treasurer Beatriz Martin.
Accounting for the digital bond will be provided by the central securities depository (CSD) network based on the SDX distributed ledger. All debt security settlements will be instantaneous and automatic and will not require the involvement of a central clearing counterparty.
A year earlier, Swiss financial giant UBS became the first bank to join a blockchain repo platform developed by Broadridge.
Source: Bits
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