UBS is asking to bondholders to approve conversion of two of its hard bullet covered bonds to soft bullet structures, with the deals targeted representing almost half the outstandings off its programme, and the Swiss bank flagging potential further similar exercises.

UBS this (Wednesday) morning announced that it will on 27 October hold investor meetings for the holders of two of its euro-denominated mortgage covered bonds, to obtain consent for the implementation of a 12 month extendible maturity for the respective issues.

The two bonds targeted in the consent solicitation are a Eu1bn 3.875% 2019 (XS0470204172) and a Eu1.25bn 4% 2022 (XS0500331557).

Bondholders who submit a consent instruction by 14 October will receive an early participation fee of 0.05% of the principle amount. UBS is the solicitation agent.

UBS said it may also approach the holders of certain of its other hard bullet covered bonds in respect of a similar amendment.

Fitch noted that the Swiss bank has six hard bullet covered bonds and one soft bullet outstanding, with the two bonds targeted in the consent solicitation constituting 48% of its outstandings. The rating agency noted that the hard bullet bonds that are not part of the consent solicitation are denominated in euros (27% of outstandings), US dollars (5%) and Norwegian krone (2%) and mostly mature in early 2017.

Moody’s and Fitch said this morning that the proposed changes would have no impact on their triple-A ratings of the covered bonds.

UBS’s covered bond programme is seen as being in wind-down, with the issuer understood to have ceased issuance upon a restructuring that saw responsibility for the mortgage covered bond transferred to a new subsidiary, UBS Switzerland.