LONDON (Finance) – Lloyds Banking Group told investors on Friday it would not redeem a 750 million euro contingent convertible (CoCo) bond as it seeks to keep its balance sheet strong in the face of the COVID-19 crisis.
Britain’s biggest domestic lender said it would not exercise its call option on the Additional Tier 1 bond – a type of CoCo instrument – on June 27 and that the bonds would reset to a new fixed coupon until the next option call date on June 27 2025.
Lloyd said it remained strongly capitalised, but added: “As a result of the extraordinary market challenges presented by Covid-19, the group has decided it is prudent to not reduce Tier 1 resources at this time.”
(Photos syndicated via Reuters)
