UK to issue first 'digital' bond by early 2027, finance minister says

LONDON, July 14 (Reuters) - Britain aims to become the first major advanced economy to issue a digital sovereign bond by doing so by early next year, finance minister Rachel Reeves said in a speech on Tuesday.

• Britain's "Digital Gilt Instrument" pilot was announced in 2024 and tests how distributed-ledger technology could make capital markets more efficient and reduce costs for financial institutions

• Reeves made the announcement in her annual Mansion House speech in the City of London financial district and said further issuance was planned after the initial sale

• Bank of England Governor Andrew Bailey said at the same event that the BoE will work to ensure the digital gilt can be used as collateral in BoE market operations

• Britain's finance ministry picked HSBC in February to run the blockchain platform which will be used by the tokenised bond

(Reporting by David Milliken; editing by William James)