Global law firm Clifford Chance has advised Natixis Pfandbriefbank on the issuance of the first digital registered covered bond on the SWIAT blockchain. The issue volume amounts to €100 million and DekaBank acts as an investor as well as a registrar and paying agent. The Frankfurt-based fintech SWIAT is a joint venture of DekaBank, LBBW and SC Ventures and provided the software for the tokenization of the registered covered bond and the private, permissioned and Basel-compliant blockchain as a settlement network.
Blockchain-based systems in the securities business promise significant efficiency gains and cost savings. The technology enables process automation in asset servicing and shortened settlement cycles, reducing current reconciliation processes and intransparencies, and mitigating counterparty risks.
The transition from paper-based to digital issuance of a covered bond enables same-day settlement and optimised security standards. The improved tradability and lower fulfilment risk make the product more attractive to investors.
The Clifford Chance team was led by partner Cristina Freudenberger (Frankfurt) and further comprised counsel Alexander Tollast (Paris) and senior associate Werner Radziwill (Frankfurt, all Global Financial Markets). As in-house counsel of Natixis Pfandbriefbank, Orna von Fürstenberg advised on the transaction.
