March 21 (Bloomberg) -- UBS AG sold $1.25 billion of covered bonds through its London branch, according to data compiled by Bloomberg.
Switzerland’s biggest bank issued 0.75 percent, dollar-denominated securities due 2016 that pay 46.5 basis points more than similar-maturity Treasuries, the data show. The bonds may be rated Aaa by Moody’s Investors Service, according to a person familiar with the transaction who asked not to be identified, citing lack of authorization to speak publicly.
Covered bonds, a form of secured financing pioneered in 18th-century Prussia, are backed by assets such as mortgages or loans and guaranteed by the issuer, letting banks fund more cheaply than traditional debt and providing investors with top-rated securities.
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