LuxSE Lists First Digital Bond With Origin
The Luxembourg Stock Exchange (LuxSE) and London-based fintech company Origin have successfully completed the first fully digital listing of a debt security on LuxSE via Origin’s digital platform. The very first bond issuance to be listed at LuxSE through the digital process of the Origin platform was a EUR 10 million senior note issuance by Banque Internationale à Luxembourg (BIL), issued and listed on LuxSE on Friday 26 February, 2021.
“This digital listing marks a milestone for our exchange and for our productive collaboration with Origin. We are convinced that digital workflows and streamlined processes will bring multiple benefits to issuers and other parties involved in a bond issuance. Digital solutions make capital markets more efficient and easier to navigate, and we are excited to be driving this change,” commented Arnaud Delestienne, Director of International Capital Markets and Member of the Executive Committee at LuxSE.
The very first bond to be listed on LuxSE through the digital process of the Origin platform was issued by @BIL_LUX!
This was made possible through the digital workflows of Origin and the API developed by LuxSE.
— Luxembourg Stock Exchange 🇱🇺 (@LuxembourgSE) March 3, 2021
Simplifying and automating processes
Through digital deal execution and automated documentation flows, Origin makes the issuance process for new financial debt instruments more reliable and efficient, and reduces the risk of errors stemming from manual processes.
Origin’s platform makes it possible for market players to generate, share and approve fully customisable term sheets and final terms. Once the final terms of a bond issuance are confirmed, the security can be listed on LuxSE via the Origin platform. This seamless listing of a debt security is made possible via an Application Programming Interface (API) developed by LuxSE that allows the documents and information created on Origin’s platform to be shared with the exchange without the need for the issuer to take any action apart from selecting LuxSE as listing option on the Origin platform.
“It is vitally important to us that the work we do, and the products we build ultimately add value to our clients and make their lives easier. That’s why we are so excited to have crystallised our collaboration with the Luxembourg Stock Exchange with this very first digitally listed transaction for BIL, and we hope this will be the first of many such transactions. Enabling digital listing is an important part of the roadmap towards building a truly digital capital market,” stated Raja Palaniappan, CEO of Origin.
Origin’s platform for bond issuance is particularly relevant for repeat issuers who are active in capital markets and who are looking for ways to streamline and automate the issuance process.
The BIL deal that became the first issuance to be listed on LuxSE via Origin is a fungible tranche, an increase of a transaction of a total size of EUR 271 million. Deutsche Bank acted as the dealer on the transaction.
“As a Luxemburg issuer, we were pleased to be a pioneer to test the e-listing of the Luxembourg Stock Exchange through the API solution set up in collaboration with Origin. This innovative experience enabled all parties involved to ramp up the automation and strengthen efficiency all over the issuance process,” said Olivier Habay, Head of Long Term Funding at BIL.
LuxSE initially acquired a 10% stake in Origin in 2019. In 2020, LuxSE strengthened its investment in the company as other investors entered the Series A funding round.
Lack of connection between the two markets in China has resulted in poor price discovery and liquidity.
Volumes of sustainable debt surpassed $1.6 trillion in 2021.
The consolidated quote system for corporate bonds has raised funds to expand outside the US.
It is important to maintain the voluntary nature of the standard.
Proposed changes would lead to an unsustainable level of additional cost and liability for issuers.