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Lugano issues 100 million franc bond in digital format based on blockchain technology

As part of its usual capital raising on the financial markets, today the Finance Division of the City of Lugano, in cooperation with Zürcher Kantonalbank, issued a 100 million franc bond with a 6-year term and 1.625% coupon, based entirely on Blockchain technology.

The issuance of the City of Lugano’s new bond was through the innovative SIX Digital Exchange (SDX) platform, linked to the SIX Group, the world’s first digital platform based on Blockchain technology to be fully regulated.

The issuance represents the first bond in the history of the public sector, to be issued, listed and traded digitally on a regulated platform based on blockchain technology.

The decision to make this important issuance through SDX is consistent with the vision and mission spelled out in the 2018-2028 Development Guidelines and concretizes the City’s orientation to want to be a “model of innovation” and to “promote and support digital transformation, technological innovation, development and research, with the aim of being a city at the forefront.” 

The City already actively promotes the use of Blockchain technology with the Lugano Plan ₿ initiative; the decision to make this issuance through the SDX platform is consistent with the philosophy of encouraging the adoption of this technology in various fields of activity.

With this transaction, the City of Lugano intends to stimulate the public sector to innovate also in the financial sector, and supports this new issuance method, which is the digital evolution of the traditional bond issuance system.

The City’s bond loan will be listed simultaneously on both the SDX platform (digital) and the SIX Swiss Exchange platform (traditional stock exchange), ensuring dual listing for investors, who will be able to trade bonds on the two platforms.

In addition, the bond has received an official rating from Moody’s rating agency of Aa3 and has the characteristics to be included in the Swiss Bond Index, like other bonds issued by Lugano in the past.

City of Lugano Communication and Institutional Relations.

The City would like to thank the partners who made this innovative issuance possible, particularly Zürcher Kantonalbank in the role of lead manager for the issuance, SDX for the technical part, and Moody’s for the implementation of the bond rating.