UK Treasury sells £5 billion of 4⅜% Treasury Gilt 2028 at auction

Published 02/07/2025, 10:44
UK Treasury sells £5 billion of 4⅜% Treasury Gilt 2028 at auction

LONDON - The United Kingdom (TADAWUL:4280) Debt Management Office (DMO) completed an auction of £5 billion of 4⅜% Treasury Gilt 2028 on Wednesday, with strong demand from investors.

The auction saw bids totaling £17.306 billion, making it 3.46 times oversubscribed, according to a DMO press release. The gilt, which carries the ISIN code GB00BSQNRC93, attracted competitive bids across a narrow price range.

Bids at the lowest accepted price of £101.324, corresponding to a yield of 3.848%, were allotted 82.296% of the amount requested. All bids at higher prices received full allocation, while those below the minimum accepted price were rejected.

The highest accepted price was £101.337, offering a yield of 3.843%. The non-competitive allotment price, calculated as the rounded average of accepted prices, was set at £101.327, representing a yield of 3.847%.

Of the total amount sold, £4.25 billion was allocated to competitive bids, while £750 million went to gilt-edged market makers through non-competitive bids. The remaining £0.002 million was allocated to other non-competitive bidders.

The auction had a narrow "tail" of just 0.1 basis points, measured as the difference between the yield at the lowest accepted price and the yield at the average accepted price.

An additional amount of up to £1.25 billion of the same gilt will be made available to successful bidders for purchase at the non-competitive allotment price, in accordance with the terms of the Information Memorandum.

Stock allotted to members of CREST will be credited to their accounts by member-to-member deliveries on the relevant settlement date.

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