WIREDGOV

Nine banks have been appointed to a framework that will advise and support on the delivery of the Scottish Government’s £1.5 billion bonds programme over the next five years.

As part of this process, HSBC Bank Plc, Merrill Lynch International, NatWest Markets Plc and RBC Europe Limited have been selected to act as the joint bookrunners – lead managers for the bonds for the Scottish Government’s inaugural bond issuance. Other banks on the framework will have the opportunity to support any subsequent bond sales.  

Law firm Clifford Chance LLP has been appointed as legal adviser to assist with its inaugural issue.  

Last year the Scottish Government was given the same high credit rating as the UK as part of preparations for the bond programme.

Deputy First Minister Jenny Gilruth said:  

“This new framework will play an important role in supporting the delivery of the Scottish Government’s bond programme, bringing together a range of market expertise.

“The funding raised from these bonds will help support delivery of the capital infrastructure projects outlined in the Spending Review, while allowing the Scottish Government to diversify its borrowing. Bonds are a standard form of borrowing for governments around the world.

“The Scottish Government’s bond programme is underpinned by high investment grade credit ratings from two global credit rating agencies. These are an endorsement of the strength of the Scottish economy and efforts we are making to drive that forward.” 

Background 

Full list of banks on framework: Banco Santander; Barclays Bank Plc; Citigroup Global Markets Limited; Deutsche Bank AG; HSBC Bank Plc; Merrill Lynch International; NatWest Markets Plc; RBC Europe Limited; Standard Charted Bank.

The Scotland Act 2016 devolved powers to Scotland to allow the issuing of government bonds for capital investment. In 2023 the Scottish Government’s Investor Panel recommended making bonds available to market as a means of raising Scotland’s profile and attracting investment. Lead managers are banks appointed by a borrower to help arrange and execute a bond issuance, including through investor engagement and managing the bond sale process.

All proceeds from a future bond issuance would be used exclusively for capital investment in line with the capital borrowing powers outlined in the Fiscal Framework agreement between the Scottish and UK Governments. 

The Scottish Government is being advised by EY. 

Next steps on bonds plan - gov.scot 

Outline business case 

Scottish Government credit rating matches