As of end-February 2013, the nominal United Kingdom (UK) bilateral loan sterling amount under the EU/IMF Programme was £2.02 billion. The end-February euro equivalent amount, taking account of the effect of currency hedging transactions, was €2.45 billion.
Taking account of the latest £0.4 billion disbursement on 6 March, the overall nominal total now stands at £2.42 billion, or approximately €2.9 billion euro equivalent. The details of the six individual UK bilateral loan amounts are set out in table format below. The table also provides details on draw down and maturity dates.
The interest rate for each disbursement of the UK bilateral loan is calculated as the weighted gross redemption yield on all UK Debt Management Office (DMO) gilt issuances to the market in the six month period up to the date of the disbursement of each portion of the loan, plus a service fee of 18 basis points. Taking account of the disbursement on 6 March, the blended interest rate on the UK loans is estimated at 2.64%.
|
Lender
|
Nominal Loan Amount
|
Date of Drawdown
|
Maturity Date
|
Term from Drawdown
|
|
UK
|
GBP 0.4bn
|
14 Oct 2011
|
15 Apr 2019
|
7.5 years
|
|
|
GBP 0.4bn
|
30 Jan 2012
|
30 Jul 2019
|
7.5 years
|
|
|
GBP 0.4bn
|
28 Mar 2012
|
28 Sep 2019
|
7.5 years
|
|
|
GBP 0.4bn
|
1 Aug 2012
|
3 Feb 2020
|
7.5 years
|
|
|
GBP 0.4bn
|
19 Oct 2012
|
19 Apr 2020
|
7.5 years
|
|
|
GBP 0.4bn
|
6 Mar 2013
|
6 Sep 2020
|
7.5 years
|
|
UK GBP Total
|
GBP 2.42bn
|
|
|
7.5 years average weighted life
|
|
€ Equivalent Total
|
€2.9bn
|
|
|
|
Under the bilateral agreement with the UK, worth a total value of £3.2 billion or (€3.8 billion based on the exchange rates prevailing in November 2010), the funds are disbursed in eight equal tranches.
Upon completion of the 9th EU/IMF Programme Review, which is presently ongoing, the UK is scheduled to disburse the next £0.4 billion instalment of its bilateral loan. This is expected in Quarter 2. The final drawdown of £0.4 billion is presently expected in Quarter 3 2013, subject to successful completion of the 10th Programme Review, which is scheduled to commence in late April. The euro value of the two remaining disbursements will only become known on drawdown, as they will be dependent on the Euro/Sterling exchange rate applicable at the time.
We expect to fully draw down all of the EU/IMF Programme funding available, including the full UK bilateral loan, and so the issue of penalties, as referred to by the Deputy, does not arise.
