Commentary & Deal Flow

Reoffer: 20NC10: UKT+250bp / 99.653 / 7.676%
Benchmark: 20NC10: UKT 4.25% 07-Mar-36 @ 93.961% / HR 95%

Final Books: £1.1bn (ex JLM)

Launched: 20NC10: £150m @ UKT+250bp - Books > £1.1bn (ex JLM)
Guidance: 20NC10: UKT+260a - Books >£900m (ex JLM)
Book Update: Books > £550m (ex JLM)
IPTs: 20NC10: UKT+280a (~7.97% annual yield)

• Issuer: LV Bonds Plc
• Guarantor: Liverpool Victoria Financial Services Limited
• Issuer/Guarantor Rating: BBB+ (S&P)
• Issue Ratings (expected): BBB- (S&P)
• Issuer LEI: 213800Q3EZSYWUQ1UM74
• Instrument: Fixed Rate Reset Callable Guaranteed Tier 2 Subordinated Notes
• Status of the Notes: Direct, unsecured and subordinated obligations of the Issuer, ranking pari passu and without any preference among themselves, as further set out in Condition 3.
• Status of the Guarantee: The Notes will be (subject to provisions in Conditions 3(c)(ii), 4(b), 6(a), 6(b), 6(g) and 8(b)) irrevocably guaranteed by the Guarantor on a direct, unsecured and subordinated basis. If a Guarantor Winding-Up occurs, claims against the Guarantor will be subordinated to the claims of all Senior Creditors (as defined in the Conditions) but shall rank:
• • (A) at least pari passu with all claims in respect of (i) all other subordinated obligations of the Guarantor which constitute, and all claims relating to a guarantee of, or other like or similar undertaking or arrangement given or undertaken by the Guarantor in respect of, any obligations of any other person which constitute, or (in either case) would but for any applicable limitation on the amount of such capital constitute, Tier 2 Capital and (ii) all obligations which rank, or are expressed to rank, pari passu therewith (together, “Parity Obligations”); and
  • (B) in priority to (a) the claims in respect of (i) any subordinated obligations of the Guarantor which rank, or are expressed to rank, junior to the Guarantee, and (ii) all obligations of the Guarantor which constitute, and all claims relating to a guarantee of, or other like or similar undertaking or arrangement given or undertaken by the Guarantor in respect of, any obligations of any other person which constitute, or (in either case) would but for any applicable limitation on the amount of such capital constitute, Tier 1 Capital and all obligations which rank, or are expressed to rank, pari passu therewith, and (b) the claims of members of the Guarantor (under any applicable legislation relating to the winding-up of companies limited by guarantee and/or of insurers) in their capacity as members of the Guarantor (together, the “Junior Obligations”).
• Solvency Condition: Other than in circumstances where a Guarantor Winding-Up has occurred or is occurring:
• • (i) all payments by the Issuer under or arising from (including any damages awarded for breach of any obligations under) the Notes or the Trust Deed shall be conditional upon the Issuer being solvent (as defined in Condition 3(c)) at the time for payment by the Issuer, and no amount shall be due or payable by the Issuer under or arising from the Notes or the Trust Deed unless and until such time as the Issuer could make such payment and still be solvent immediately thereafter; and
  • (ii) all payments by the Guarantor under or arising from (including any damages awarded for breach of any obligations under) the Notes or the Trust Deed shall be conditional upon the Guarantor being solvent (as defined in Condition 3(c)) at the time for payment by the Guarantor, and no amount shall be due or payable by the Guarantor under or arising from the Notes or the Trust Deed (including, without limitation, the Guarantee) unless and until such time as the Guarantor could make such payment and still be solvent immediately thereafter,
  • (the “Solvency Condition”).
• Set-off: Noteholders will, by virtue of holding any Note, waive any right of set-off, compensation, counterclaim, netting or retention that such Noteholder might otherwise have against the Issuer or the Guarantor in respect of or arising under the Notes or the Trust Deed (including the Guarantee) whether prior to or in the event of an Issuer Winding-Up or Guarantor Winding-Up (as applicable).
• Rights in an Issuer Winding-Up: If an Issuer Winding-Up occurs at any time when a Guarantor Winding-Up has also occurred or is occurring, the Trustee on behalf of the Noteholders may claim or prove in such Issuer Winding-Up for (in lieu of any other amount) an amount equal to the outstanding principal amount of the Notes together with all Arrears of Interest (if any) and any other accrued but unpaid interest on the Notes and any damages awarded for breach of any obligations under the Notes and the Trust Deed, such claims being subordinated as provided in Condition 3(b) and the Trust Deed. If and to the extent that the amount that the Noteholders could recover in such Issuer Winding-Up would exceed the amount per Note that would have been paid in respect of such Note in such Guarantor Winding-Up (had the Note been a subordinated obligation of the Guarantor for an amount equal to the relevant Guaranteed Amounts and ranking pari passu with the Guarantee), then the Noteholders shall, without the need for any further step or action, assign (and be treated as having assigned) irrevocably such excess amounts and the right thereto to the Guarantor.
• • If an Issuer Winding-Up occurs at any time when a Guarantor Winding-Up has not also occurred or is not occurring, the Noteholders (in relation to any amount which they are entitled to receive in such Issuer Winding-Up in respect of, or arising under, the Notes and the Trust Deed) shall, without the need for any further step or action, assign (and be treated as having assigned) irrevocably such amounts and the right thereto to the Guarantor as consideration for the Guarantor’s agreement to assume, or procure the assumption by a Subsidiary of the Guarantor of, the obligations of the Issuer pursuant to, and in accordance with, Condition 4(c).
• Rights in a Guarantor Winding-Up: If a Guarantor Winding-Up occurs, Trustee on behalf of the Noteholders may claim or prove in such Guarantor Winding-Up for (in lieu of any other amount) an amount equal to the outstanding principal amount of the Notes together with all Arrears of Interest (if any) and any other accrued but unpaid interest on the Notes and any damages awarded for breach of any obligations under the Notes and the Trust Deed, such rights and claims being subordinated as provided above and in Condition 4(b).
• No double recovery: Amounts received by Noteholders in an Issuer Winding-Up shall reduce pro tanto the amounts payable by the Guarantor under the Guarantee, and amounts received by Noteholders in Guarantor Winding-Up shall reduce pro tanto the amounts payable by the Issuer under the Notes and the Trust Deed.
• Currency: GBP
• Nominal Amount: £150,000,000
• Pricing Date: 28-Apr-26
• Issue Date/Settlement Date: 05-May-26 (T+4)
• Interest Commencement Date: Issue Date
• Maturity Date: 05-May-46
• Optional Redemption Date(s): Subject to Conditions 8(b) and 8(h), the Issuer may at its option redeem all (but not some only) of the Notes at their principal amount together with all Arrears of Interest (if any) and any other accrued and unpaid interest to (but excluding) the date of redemption on the First Reset Date or any Interest Payment Date thereafter.
• Special Redemption Events: Subject to Conditions 8(b) and 8(h), the Issuer may at its option redeem all (but not some only) of the Notes at their principal amount together with all Arrears of Interest (if any) and any other accrued and unpaid interest to (but excluding) the date of redemption in the event of the occurrence of specified tax events, a Capital Disqualification Event, a Ratings Methodology Event (or if a Ratings Methodology Event will occur within six months) or if 75% or more of the aggregate principal amount of the Notes originally issued has been (or, in certain circumstances, will be) purchased by the Issuer, the Guarantor or any other member of the Insurance Group and cancelled, all as described in Condition 8.
• Substitution or Variation: Subject to Conditions 8(b) and 8(h), the Issuer may, at its option, at any time substitute all (but not some only) of the Notes for, or vary the terms of the Notes so that they become or remain, Qualifying Tier 2 Securities or (as the case may be) Rating Agency Compliant Securities, in the event of the occurrence of specified tax events, a Capital Disqualification Event or a Ratings Methodology Event (or if a Ratings Methodology Event will occur within six months), all as described in Condition 8.
• Mandatory Deferral of Redemption: No Notes shall be redeemed on the Maturity Date pursuant to Condition 8(a) or prior to the Maturity Date pursuant to any of Condition 8(d), 8(e), 8(f) or 8(i) if a Regulatory Deficiency Redemption Deferral Event has occurred and is continuing or would occur if redemption were made on the otherwise applicable redemption date pursuant to Condition 8. If redemption of the Notes does not occur due to a Regulatory Deficiency Redemption Deferral Event or as a result of the Solvency Condition not being satisfied with respect to the relevant payment of principal, such redemption shall be suspended and shall occur thereafter only in accordance with Condition 8(b).
• Initial Rate of Interest: 7.625% per cent. per annum, payable annually in arrear (subject to deferral in accordance with Condition 3(c) or Condition 6)
• Optional Deferral of Interest: The Issuer or the Guarantor may elect in respect of any Interest Payment Date for payment of the accrued but unpaid interest to that date to be deferred (in whole or in part) for any reason.
• Mandatory Deferral of Interest: Payment of interest on the Notes will be mandatorily deferred on each Regulatory Deficiency Interest Deferral Date (subject to exceptional waiver of deferral by the Relevant Regulator in certain circumstances).
• • Any interest not paid on an Interest Payment Date as a result of (i) the exercise by the Issuer or the Guarantor of its discretion to defer such payment of interest pursuant to Condition 6(a), (ii) any mandatory deferral of such payment of interest pursuant to Condition 6(b) or (iii) the operation of the Solvency Condition in accordance with Condition 3(c) shall, to the extent and so long as the same remains unpaid, constitute “Arrears of Interest”. Arrears of Interest shall not themselves bear interest, and shall be payable as provided in Condition 6(f).
• Interest Payment Dates: 5 May in each year commencing on 05-May-27
• Reset Rate of Interest: Reset Reference Rate (5-year gilt yield) plus the Reset Margin, payable annually in arrear (subject to deferral in accordance with Condition 3(c) or Condition 6)
• Reset Dates: 05-May-36 (the “First Reset Date”) and each fifth anniversary of the First Reset Date thereafter
• Reference Benchmark (Gilt): UKT 4.25% due 07-Mar-36 (ISIN: GB0032452392), 95% HR
• Reference Benchmark Price: 93.961% (mid) / 93.941% (bid)
• Reference Benchmark Yield (semi-annual): 5.034% (mid)
• Re-offer Spread vs Reference Benchmark (semi-annual): 250 bps (the “Initial Margin”)
• Re-offer Yield (semi-annual): 7.534%
• Re-offer Yield (annual): 7.676%
• Issue/Re-offer Price: 99.653%
• Reset Margin: 3.500% (Initial Margin + 100bps)
• Day Count Fraction: Actual / Actual – ICMA
• Substitution of the Issuer or Guarantor: Condition 15 and the Trust Deed will contain provisions requiring the Trustee to agree with the Issuer and the Guarantor, without the consent of the Noteholders, but subject to certain conditions: (i) to the substitution of the Guarantor or its successor in business in place of the Issuer as principal debtor under the Notes; or (ii) (subject to the Notes remaining unconditionally and irrevocably guaranteed on a subordinated basis by the Guarantor), to the substitution of a Subsidiary or parent company of: (a) the Issuer or its successor in business or (b) the Guarantor or its successor in business, in place of the Issuer or any previous substitute under Condition 15 as principal debtor under the Notes; or (iii) to the substitution of a successor in business to the Guarantor in place of the Guarantor or any previous substitute under Condition 15.
• Transfer of Business of the Guarantor: In connection with any transfer of the whole or a substantial part (as defined in Condition 17) of its business to (a) another body in accordance with Part VII (Control of Business Transfers) of the FSMA or (b) a single legal entity where such transfer is pursuant to the exercise by the Relevant Regulator under the Financial Services Compensation Scheme of its powers in connection with any applicable law, rule or regulation, the Guarantor shall procure that, subject to satisfaction of the Regulatory Clearance Condition, there shall be included in the transfer all the liabilities and obligations of the Guarantor as obligor under the Guarantee.
• Enforcement: The rights of Noteholders to enforce payment obligations in respect of the Notes and the Trust Deed (including the Guarantee) are limited, as provided in Condition 11
• Specified Denominations: £100,000 and integral multiples of £1,000 in excess thereof
• Calculation Amount: £1,000
• Form of Notes: Registered
• Listing: London Stock Exchange’s International Securities Market
• ISIN / Common Code: XS3336934701 / 333693470
• Selling Restrictions: Reg S only (Cat 2). Any sales of the Notes must be made in compliance with all applicable selling restrictions and as per the Preliminary Admission Particulars, in particular in the U.S., UK, EEA, Italy, Switzerland, Hong Kong and Singapore
• Prohibition of Sales to Retail Investors: Manufacturer target market (UK MiFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No EEA PRIIPs KID or UK PRIIPs KID/CCI product summary will be prepared as the Notes are not available to EEA or UK retail investors
• Use of Proceeds: General corporate purposes, including the refinancing of existing indebtedness
• Documentation: Stand-alone format. Preliminary Admission Particulars dated 27-Apr-26 and final Admission Particulars to be published prior to the Issue Date
• Joint Lead Managers: Barclays Bank PLC (B&D), Jefferies International Limited
• Settlement: Euroclear and Clearstream, Luxembourg
• Governing Law and Jurisdiction: English law / English courts
• Timing: TOE 14.34 LDN. FTT 14.55 LDN