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Scotland Sets 2026–27 Debut for ‘Kilt’ Bonds After UK‑Matching Credit Ratings

Timing will be set by market conditions as well as the Holyrood election.

Overview

  • Moody’s assigned Aa3 and S&P Global assigned AA to the Scottish Government, matching the UK and citing a stable devolution framework and prudent fiscal management.
  • Ministers plan a bond programme of up to £1.5 billion over the next parliament to finance capital investment in priorities such as housing and net‑zero projects.
  • The government will begin appointing banks as joint lead managers, with EY advising on the issuance process.
  • Both agencies cautioned that material steps toward independence, a UK downgrade, or budget pressures could lead to lower ratings.
  • Scotland gained the power to issue bonds in 2015 but has mainly borrowed via the UK’s National Loans Fund, and any issuance will operate within existing borrowing limits.