Societe Generale issues tokenized bonds on Ethereum blockchain

• The French bank issued  OFH tokens  100 million euros of  covered bonds.  
• The lender experiments with the new procedure of bond issuance.  

Societe Generale Group, one of the largest financial institutions in France, issued tokenized bonds to the tune of $112 million on the Ethereum blockchain.

According to the announcement, the bank’s  subsidiary  Societe Generale SFH issued  OFH tokens backed by covered bonds in the amount of 100 million euros.  

“This live transaction explores a more efficient process for bond issuances. Many areas of added value are predicted, among which, product scalability and reduced time to market, computer code automation structuring, thus better transparency, faster transferability and settlement. It proposes a new standard for issuances and secondary market bond trading and reduces cost and the number of intermediaries,”  the company commented in its press-release.

Meanwhile, the  rating agency Moody’s Investors Service released the information that  Societe Generale was “the sole investor” of the issue, which means that the tokens were not sold outside the company.

This project was designed and implemented by one of the internal startups of the bank called  Societe Generale FORGE. According to the press-release, the company was consulted by  PwC on the technology aspects and by  French law firm  Gide Loyrette Nouel on legal aspects.

Societe Generale joined the group of large financial institutions experimenting with blockchain technologies and cryptocurrencies.  Earlier  this year, the US-based J.P. Morgan announced the launch of  a proprietary digital coin JPM Coin, while  Barclays Bank and Royal Bank of Scotland (RBS) joined R3 to  streamline real estate purchases.