02 July 2019

In the first of its kind for the UK banking sector, NatWest has provided corporate customer National Express Group PLC with a bilateral SONIA (Sterling Overnight Index Average) loan facility. 

The loan is the first in the pilot that NatWest is running with a small number of customers, before launching the product to the wider market later this year in response to calls from the Financial Conduct Authority (FCA) to accelerate the transition away from LIBOR (London Interbank Offered Rate) to Risk-Free Rates by the end of 2021. Taking methodology already used in the sterling public bond market, SONIA will be applied using daily compounding with a five-day reset lag, and represents the convention of choice by the market so far.

The Burges Salmon team, which was led by head of Banking Richard Leeming, with assistance from senior associate Ed Hobbs and associate Christopher Herford, advised National Express on all legal aspects of the deal.

Richard Leeming says: “We have a fantastic team of Banking lawyers that manage a wide range of complex financing transactions for our diverse portfolio of clients. However, it’s not every day that you get the opportunity to advise a client on an area of law for a deal that has never been done before.

We recognise that LIBOR has had its day and we’re therefore delighted to have advised National Express on this banking sector first, as part of our wider work that we carry out for them.

National Express is a leading public transport operator with bus, coach and rail services across the UK, Europe, North Africa, North America and the Middle East, delivering nearly 900 million journeys in 2018.

David Daniels, group treasurer at National Express: “Helping to lead the charge of markets moving off LIBOR by the end of 2021, we are proud to be the first company in the UK to take a loan using SONIA.  We’re grateful to the team at our long-standing banking legal advisers, Burges Salmon, for adeptly helping us get this deal over the line.” 

NatWest were advised by Ashurst.

Key contact

Richard Leeming

Richard Leeming Partner

  • Banking and Trade Finance
  • Derivatives, Debt Capital Markets and Securitisations
  • Real Estate Finance

Subscribe to news and insight

Burges Salmon careers

We work hard to make sure Burges Salmon is a great place to work.
Find out more