France is a country that is aggressively pursuing blockchain innovation. Crowdfund Insider’s recent coverage of Paris Blockchain Week highlighted this fact as both policymakers and innovators appear to be on the same page.
Now, big banking is moving forward in the crypto space by actually completed a tokenized bond issuance leveraging Ethereum.
Societe Generale has issued a covered bond (“obligations de financement de l’habitat” or “OFH”) for a total amount of €100 million. This security token has been rated Aaa / AAA by Moody’s and Fitch. The security token issuance has been fully subscribed by Societe Generale.
Societe Generale is the third largest bank in France and one of the largest global banks in the world. It employs over 140,000 employees and has assets well over a trillion euros.
The bank says this is a pilot project by Societe Generale and Societe Generale FORGE, one of the 60 internal startups launched via the Internal Startup Call, the Group’s intrapreneurial program. Management at the bank seeks to experiment with Fintech to create disruptive solutions, this time using blockchain, as digital capital market solutions emerge.
According to Societe Generale, this live transaction “explores a more efficient process for bond issuances.” This includes reduced time to market, scalability, automation, improved transparency plus faster transferability and settlement. Effectively by using blockchain much of the fricion has been removed from the bond issuance.
Societe Generale says it proposes a “new standard for issuances and secondary market bond trading and reduces cost and the number of intermediaries.”
A diverse team of Societe Generale executives worked to complete the pilot project. This included legal, compliance, finance and operations. The bank said that Gide Loyrette Nouel was appointed as legal advisor to the OFH Token issuer and PwC France and francophone Africa was involved as blockchain advisor.
Societe Generale said the security token issuance is indicative that innovation is core to their banking DNA.
Previously, Societe Generale launched we.trade, a blockchain-based trade finance platform now available to all its corporate clients in France, as well as the launch of komgo SAto, to digitize the trade and commodities finance sector through a blockchain based open platform.
Last year, Societe Generale acquired France based renewable energy investment crowdfunding platform Lumo.
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