The United Kingdom Debt Management Office (DMO) said there were a record 248 orders placed for the 7.0 billion pounds on offer of the new issue of the 4.75% 2043 gilt, a future 20-year benchmark.
The orders fell only slightly short of the all-time high demand for a British government bond, which came in September 2021 when investors placed just over 100 billion pounds in orders for Britain's first "green" government bond, which attracted investors keen to finance environmental projects.
"This successful outcome represents a clear manifestation of the excellent support we continue to receive from our core investor base for UK government bonds," said Jessica Pulay, co-head of policy and markets at the DMO.
Domestic investors accounted for around 90% of the buyers, the DMO said.
The gilt was priced to give a yield of 4.6357%, 5.75 basis points more than the similar 4.5% 2042 gilt, a price at the top end of initial guidance, as is standard for British government bond syndications.
This yield was only just below the record 4.6562% which investors received for a 40-year gilt sold via syndication on Sept. 5, reflecting the surge in British government borrowing costs over the past two years.
Orders at British bond syndications are typically several times higher than the amount investors expect will be sold, as orders are almost never filled in full.
The DMO said it had now sold 148.3 billion pounds of gilts out of a 237.8 billion-pound target for the 2023/24 financial year.
The DMO will revise its sales plans for the remainder of the financial year on Nov. 22, after finance minister Jeremy Hunt gives a mid-year fiscal update.
Barclays, HSBC, Lloyds Bank, Morgan Stanley and UBS acted as joint bookrunners on the transaction.
($1 = 0.8051 pounds)
(Reporting by Andy Bruce and David Milliken; Editing by William Schomberg)
By Andy Bruce and David Milliken
