Bond ambition | Archive Titles

Comparison of bank and bond rates
30-year bank loan using swap to fix rate	40-year bond issue	Debt credit reserve not included, minimum reserve six months
Underlying rate 4.7%	Underlying gilt rate 4.34%	Investment grade credit ratings range from AAA to BBB, RSLs are typically rated at AA-
Lending margin 0.5%	Estimated spread for AA- rated organisation 0.85%	Investors start with the return they would get from lending money to the government and add a rate on top to compensate for the extra risk, called the spread
Overall 5.2%	Overall 5.19%
Source: Royal Bank of Scotland, 13/3/03

Leading arrangers of bond issues
	£bn
RBC Capital Markets	1.527
HSBC	0.758
Royal Bank of Scotland Group	0.594
Dresdner Kleinwort Benson	0.424
BNP Paribas*	0.197
Morgan Stanley	0.160
Barclays Capital	0.118
Other lenders	0.132
Total	3.910
* Sold social housing portfolio to Halifax/Bank of Scotland in May 2002
Source: NHF/HC Private Finance Monitoring Bulletin, March 2003