On Monday the Canton of Zurich issued a CHF 100 million ($113m) digital bond via the SIX Digital Exchange (SDX). The most distinctive aspect is the transaction settles using a wholesale central bank digital currency (wholesale CBDC) issued by the Swiss National Bank (SNB). Zurich’s digital bond has an 11 year term and a coupon of 1.45%.
The joint lead managers on the issuance were Zürcher Kantonalbank, UBS and Raiffeisen Switzerland. Zürcher and UBS were announced as part of the CBDC pilot earlier this month, but Raiffeisen was not.
A Zurich spokesperson confirmed that wholesale CBDC settlement takes place on December 1 and only for the two pilot banks. Raiffeisen and the Canton of Zurich will receive conventional Swiss francs, not wholesale CBDC. At that point, the bond will be listed on both the SIX Digital Exchange and the main SIX Swiss Exchange.
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