The Lemon Fool

Some of us no doubt hold, ticker FAP.
With the withdrawal of NatWest from the RoI, this ex-Bristol & West perp will once again be looking for a home.

Doubtless small beer amongst the debris of the 175 year-old bank., the only potential clue to its future may lie in a para from Friday's RNS :
NWG is also in early discussions with Permanent TSB Group Holdings plc amongst other strategic banking counterparties about their potential interest in buying certain retail and SME assets, liabilities and operations.

So far, no reflection in the price, which remains dizzyingly above par.

https://www.lse.co.uk/rns/FAP/ulster-ba ... 974di.html

V8 (piddling holding)

I don't understand. Surely they can't just walk away from their liabilities. Won't they have to make an offer to purchase the bonds?

Kr1ck wrote:I don't understand. Surely they can't just walk away from their liabilities. Won't they have to make an offer to purchase the bonds?

I imagine Natwest would prefer to transfer the liabilities, easier, cleaner than trying to hoover them up.

If push came to shove, one would have to read the prospectus to see where bondholders stand, but after the fuss when Bank of Ireland tried par redemption, I doubt Natwest or the UK govt would want to get into that, particularly at the moment.

V8

88V8 wrote: the fuss when Bank of Ireland tried par redemption,

??? Don't remember this. Are you thinking of another issuer, perhaps Lloyds with their ECNs?


GS

GoSeigen wrote:

88V8 wrote: the fuss when Bank of Ireland tried par redemption,

??? Don't remember this. Are you thinking of another issuer, perhaps Lloyds with their ECNs?

You don't remember it because what I vaguely misremembered didn't happen... what actually nearly happened was a forced conversion into equity https://www.reuters.com/article/uk-bank ... edirect=uk. I missed all the ensuing fuss as I wasn't a BOI holder at the time.

Anyway, there was ensuing fuss, in which Mark Taber late of TMF was heavily involved, and doubtless the need to avoid an equivalent public fuss would be in NatWest's mind at this time.

V8

88V8 wrote:

GoSeigen wrote:

88V8 wrote: the fuss when Bank of Ireland tried par redemption,

??? Don't remember this. Are you thinking of another issuer, perhaps Lloyds with their ECNs?

You don't remember it because what I vaguely misremembered didn't happen... what actually nearly happened was a forced conversion into equity https://www.reuters.com/article/uk-bank ... edirect=uk. I missed all the ensuing fuss as I wasn't a BOI holder at the time.

Anyway, there was ensuing fuss, in which Mark Taber late of TMF was heavily involved, and doubtless the need to avoid an equivalent public fuss would be in NatWest's mind at this time.

V8

Hmm, then like Kr1ck I have no idea what this thread is about. The liabilities will either remain with the current owners of Ulster Bank or be transferred to the new owners. I doubt bondholders will notice any difference... unless the new lot have a very shaky business.

GS

GoSeigen wrote:

88V8 wrote:

GoSeigen wrote:??? Don't remember this. Are you thinking of another issuer, perhaps Lloyds with their ECNs?

You don't remember it because what I vaguely misremembered didn't happen... what actually nearly happened was a forced conversion into equity https://www.reuters.com/article/uk-bank ... edirect=uk. I missed all the ensuing fuss as I wasn't a BOI holder at the time.

Anyway, there was ensuing fuss, in which Mark Taber late of TMF was heavily involved, and doubtless the need to avoid an equivalent public fuss would be in NatWest's mind at this time.

V8

Hmm, then like Kr1ck I have no idea what this thread is about. The liabilities will either remain with the current owners of Ulster Bank or be transferred to the new owners. I doubt bondholders will notice any difference... unless the new lot have a very shaky business.

Well, I hope so.
Do you think it can be taken for granted?

V8

I guess the issue isn't with Natwest as they aren't going to make life difficult for themselves withdrawing from Ireland for the sake of what is a small issue to them.

The question is more how any purchaser would view this instrument.}

88V8 wrote:With the withdrawal of NatWest from the RoI, this ex-Bristol & West perp will once again be looking for a home.

The Bristol & West Building Society was taken over by the Dublin based "Bank of Ireland", not the "Royal Bank of Scotland". As its name suggests isn't Ulster Bank based in Northern Ireland rather than the Republic?

Alaric wrote:

88V8 wrote:With the withdrawal of NatWest from the RoI, this ex-Bristol & West perp will once again be looking for a home.

The Bristol & West Building Society was taken over by the Dublin based "Bank of Ireland", not the "Royal Bank of Scotland". As its name suggests isn't Ulster Bank based in Northern Ireland rather than the Republic?

Yes, I think the OP is confused about the original issuer which was First National Building Society, which converted to First Active PLC, hence the ticker "FAP". I don't think it has anything to do with Bristol & West.


Ulster Bank operates both sides of the border.


GS

GoSeigen wrote:Yes, I think the OP is confused about the original issuer which was First National Building Society, which converted to First Active PLC, hence the ticker "FAP". I don't think it has anything to do with Bristol & West.
Ulster Bank operates both sides of the border.

Despite assiduous research the OP is not able to reproduce the 'connection' between Ulster Bank and the Bristol & West.
Ahem.
Moving on...

The Ulster Bank is only departing from the Republic. Presumably if the bonds are transferred to Ulster Bank in Northern Ireland, or to another entity outside the Republic, the 20 % Eirish withholding tax will no longer apply.

Currently, the yield net of tax is an uninteresting 5%. This is a screen price, ii won't trade them online.
If the WHT disappears, it would be nice to think that there might be a small window of opportunity before the price reacts.
Well, one can hope.

V8

Notice of teleconference 7th July anent something which tbh goes completely over my head, but appears to change the interest rate https://www.lse.co.uk/rns/FAP/notice-of-meeting-and-resolution-qwyf5qzs265tmut.html effective March 2022.

Since when were these 'floating rate'?

V8 (small holding)

I have just stumbled across this announcement from 13 Sept of a tender offer for the Ulster Bank 11.75% perpetual subordinated bonds (Ticker FAP, ISIN IE0004325514) so sharing here in case any holders are not aware:
https://www.londonstockexchange.com/new ... n/16122258
I have held these in my ii ISA from the days when they were cheap as chips. I have had nothing from ii on the tender offer despite it having been announced 8 days ago!
Offer price is 175 so an exit yield of 6.7% which is good enough for me to say goodbye.

OldBoyReturns wrote:I have just stumbled across this announcement from 13 Sept of a tender offer for the Ulster Bank 11.75% perpetual subordinated bonds (Ticker FAP, ISIN IE0004325514) so sharing here in case any holders are not aware:
https://www.londonstockexchange.com/new ... n/16122258
I have held these in my ii ISA from the days when they were cheap as chips. I have had nothing from ii on the tender offer despite it having been announced 8 days ago!
Offer price is 175 so an exit yield of 6.7% which is good enough for me to say goodbye.

Wow! I can trade in my one thousand pounds-worth without being killed by the spread.

I see that the min holding now is £10,000 so that must have changed at some point. I have held my measly £1,000 for many years.

Not coercive and no 'voting fee' but about 30% premium so pretty good. The exit yield, btw, depends whether one has been subject to the 20% WHT. If I gross up your 6.7% by the WHT that's 8.38% which is not too shabby.

V8

Corporate action now posted by ii, one of their lazier efforts which doesn't even mention the offer price !
Anyway, I tendered my bonds.

V8

Surprisingly low take-up of the FAP (11.75% PSBs) tender offer with only £6.5M out of £20M accepting. Issuer has accepted for purchase nonetheless with settlement date of today. Now holding my breath waiting for the funds to be credited by ii.

https://www.londonstockexchange.com/new ... s/16181966

"Results of the Offers and the Proposals

The Offers in respect of the Bonds expired at 1.00 p.m. (London time) on 23 October 2023. As of the Expiration Deadline valid tenders in respect of EUR 24,346,432.49 in principal amount of the 11.375% Bonds and £6,486,500 in principal amount of the 11.75% Bonds have been received.

The Issuer has decided to accept for purchase all Bonds validly tendered pursuant to the Offers in respect of the Bonds. The Settlement Date for the Offers in respect of the Bonds is expected to be 1 November 2023."

Yes - but where next?

Laughton wrote:Yes - but where next?

Sorry - not clear what you are asking here.

Laughton wrote:Yes - but where next?

You mean which will be tendered next, or what to buy with the proceeds?

I think the answer to both is any of the insurers' prefs.

V8

Sorry, not very clear on second reading.

I meant that when broker decides to let me have my money, the question is where to deploy it?