Lloyds TSB Bank launched a 15 year sterling benchmark sized transaction today (Thursday), coming to the long end of the sterling market for the second time this year, after having issued a 13 year in January.

Leads Goldman Sachs, Lloyds and Santander went out with initial guidance of the 195bp over Gilts area, and had built a book in excess of £1bn by 1100 London time.

“It’s a very natural trade at this maturity in sterling,” said a syndicate official away from the leads. “It goes along with the FSA’s encouragement for longer dated bonds.

“Lloyds did a long covered bond earlier in the year in sterling, which went very well,” he added.

The issuer came to the market with a £1.25bn 13 year on 20 January at 270bp over Gilts.

“It’s a very well anchored name,” said the syndicate official.

Another syndicate official away from the leads said the pricing was “bang on the money”.

According to the syndicate official, Lloyds has March 2025s and February 2029s trading at 190bp over Gilts on the bid side.

A banker away from the deal also said pricing was fair, putting it about 5bp back of Lloyds’ curve.

“We’ll see how Lloyds works because markets are under a little bit of pressure, particularly the euro market,” he said. “We will have to see how that affects the sterling market, this market correction.”

A syndicate official away from the leads said Lloyds would do fine, in spite of the weak tone. He put the new issue premium at 5bp-7bp.