Lloyds and Archax complete public blockchain deal using tokenised deposits

Lloyds Banking Group says it has completed the UK’s first public blockchain transaction using tokenised deposits, marking a milestone in the development of digital finance and the use of blockchain infrastructure within regulated banking. The transaction involved the issuance of sterling tokenised deposits on a public blockchain, a first both for the UK market and globally for deposits denominated in pounds sterling. Lloyds Bank PLC issued the tokenised deposits on the Canton Network, a blockchain designed for regulated financial markets, before using them to purchase a tokenised UK government bond from Archax.

Lloyds Bank Corporate Markets executed the transaction, transferring the tokenised deposits to Archax in exchange for the tokenised gilt. The underlying funds were then moved back into Archax’s standard Lloyds account, demonstrating interoperability between blockchain-based assets and traditional banking systems.

The use of a public blockchain differentiates the transaction from earlier digital asset pilots that have relied on private or closed networks. Lloyds says the Canton Network combines broader accessibility with the confidentiality requirements of regulated financial institutions, potentially supporting wider industry adoption.

The development comes as the UK government continues to explore the potential issuance of digital securities. By applying tokenisation to gilts, the transaction illustrates how established financial instruments could be integrated into digital market infrastructure without changing their underlying characteristics.

For corporate treasurers, tokenised deposits could represent a new way of interacting with blockchain-based markets while retaining familiar features of bank deposits. These include the ability to earn interest and the protections associated with regulated deposit accounts. Tokenised deposits also allow businesses to settle transactions directly on blockchain networks without having to move funds out of the banking system.

Lloyds highlights several operational implications for businesses, including real-time settlement, which can reduce counterparty risk and improve liquidity management. The use of smart contracts could also automate payment and settlement processes, potentially lowering operational risk and manual intervention. Distributed ledger technology provides a permanent transaction record, which may support audit and compliance processes.

As part of the pilot, Lloyds operated its own validator node on the Canton Network. Validator nodes are responsible for verifying transactions on the blockchain, and Lloyds says this allowed it to apply the same security and control standards used for managing customer cash deposits.

The transaction builds on earlier work between Lloyds and Archax, including a previous use of tokenised money market fund units as collateral. Together, these initiatives signal a gradual expansion of tokenisation beyond experimental use cases and into live transactions involving regulated assets.

Surath Sengupta, head of transaction banking products at Lloyds, says the deal offers “a glimpse into the future of finance; faster, smarter, and more efficient”. He adds that tokenisation allows real-world assets to be brought onto blockchain infrastructure “without losing the benefits of traditional deposits”, noting that tokenised deposits can continue to earn interest and remain protected by the Financial Services Compensation Scheme. Sengupta describes the pilot as a critical step toward building a future digital financial ecosystem.

 

US payroll growth slows in December as unemployment edges lower

US job growth eased in December but remained consistent with an economy expanding at a pace that supports corporate earnings and potential monetary policy easing, according to analysis from Evelyn Partners. Non-farm payrolls increased by 50,000 in December, below the consensus forecast of 60,000 and down from 56,000 in November. The slowdown was more pronounced in the private sector, where payrolls rose by 37,000, compared with expectations of 64,000 and a prior month reading of 50,000.

Despite softer hiring, the unemployment rate fell to 4.4% in December, beating expectations of 4.5% and improving on November’s 4.5% reading. The data suggest the labour market is cooling gradually rather than deteriorating sharply.

There is also little evidence that recent US tariff increases have materially affected corporate profit margins. According to Evelyn Partners, the relative stability in margins reduces the likelihood of a significant rise in unemployment over the next 12 months, even as growth moderates.

Daniel Casali, chief investment strategist at Evelyn Partners, says the slowdown in monthly job creation reflects a combination of policy and structural factors. “Monthly non-farm payrolls have slowed throughout 2025 due to a confluence of factors,” he says, pointing to tighter immigration policies under the Trump administration and a wave of federal employees leaving their roles following early retirement and redundancy programmes under the Department of Government Efficiency.

Even so, Casali argues there are still clear incentives for firms to continue hiring. One is resilient economic growth, underpinned by solid domestic demand. He notes that real final sales to private domestic purchasers, which exclude more volatile components such as inventories, government spending and exports, are projected by the Atlanta Fed’s nowcast model to grow by 2.8% in the fourth quarter. Average hourly earnings are also rising faster than inflation, supporting household consumption and giving businesses confidence to expand headcount.

A second factor is the relative cost of labour. In the third quarter of 2025, labour compensation accounted for around 50.7% of US GDP, a record low and well below the cyclical peak of 57.8% recorded in 2001. Casali links the longer-term decline to global labour supply dynamics following China’s entry into the World Trade Organisation, arguing that relatively low labour costs continue to support hiring.

Improved labour market efficiency is the third driver. Advances in digital platforms and remote working have allowed firms to shift service-sector roles to regions with higher unemployment and lower wages, while tools such as professional networking platforms have improved job matching and reduced frictional costs.

The combination of softer job growth, stable margins and easing wage pressures strengthens the case for potential proactive interest rate cuts by the Federal Reserve. Casali suggests this backdrop could provide a liquidity boost to equity markets and improve the chances of companies meeting earnings expectations, reinforcing the equity rally already under way.

 

Strong exports set to underpin China growth in 2026

China’s economy is expected to expand faster than consensus forecasts in 2026, supported by resilient exports and a gradually easing drag from the property sector, according to analysis from Goldman Sachs Research. The bank forecasts China’s real GDP will grow by 4.8% next year, compared with a consensus estimate of 4.5%. The outlook is driven by steady export volumes and a moderation in the economic impact of the prolonged downturn in property activity.

Goldman Sachs Research expects nominal export growth to remain firm at 5.6% in 2026, broadly in line with 5.5% growth in 2025 when measured in US dollar terms. The projection reflects stronger exports to emerging market economies, China’s position in critical minerals supply chains and the potential for continued expansion in high-tech exports.

While exporters have successfully diversified away from the US market, the analysis highlights longer-term structural challenges. Hui Shan, chief China economist at Goldman Sachs Research, says policymakers will need to identify new engines of growth beyond manufacturing and trade. “Building a consumption- and services-driven economy will take years, if not decades,” she writes.

One of the firm’s most notable out-of-consensus views relates to China’s external balance. Goldman Sachs Research expects the country’s current account surplus to rise to 4.2% of GDP in 2026, up from 3.6% last year. By contrast, economists surveyed by Bloomberg expect the surplus to narrow to 2.5% of GDP. The bank attributes its more bullish forecast to China’s export competitiveness and the relative weakness of domestic demand.

The property sector remains a key constraint on growth, now entering its fifth year of decline. Goldman Sachs estimates that the sector reduced annual real GDP growth by around 2 percentage points in both 2024 and 2025. However, the drag is expected to diminish gradually, narrowing by around 0.5 percentage points per year over the next few years.

For finance leaders and investors, the outlook points to an economy increasingly reliant on external demand in the near term, even as policymakers face a longer transition toward a more consumption-led growth model.

 

Interoperable eBL trade goes live between Thailand and China

Banks and trade platform providers have completed a live cross-platform electronic bill of lading (eBL) transaction involving counterparties in Thailand and China, marking a practical step toward interoperability in digital trade finance. The transaction brought together GSBN, IQAX and ICE Digital Trade, alongside shipping, corporate and banking participants including New Golden Sea Shipping, Lenzing (Thailand), HSBC Thailand, China Zheshang Bank and Jiangsu Dasheng Group. The end-to-end flow demonstrated that eBLs can be issued, transferred, presented and surrendered across different platforms while remaining legally valid and operationally secure.

The transaction began with New Golden Sea Shipping issuing an eBL to Lenzing Thailand on the IQAX platform. The document was then transferred via ICE CargoDocs to HSBC Thailand and presented to China Zheshang Bank on the same platform. The process concluded with the surrender of the eBL by Jiangsu Dasheng through IQAX. The sequence showed interoperability not only between eBL platforms, but also between shipping and banking networks.

The collaboration connects the IQAX eBL and ICE CargoDocs platforms and uses GSBN’s blockchain-based infrastructure to maintain document singularity as the eBL moves between systems. This addresses a long-standing concern in digital trade around ensuring that only one authoritative version of a transferable document exists at any time.

In developing the framework, the partners focused on legal enforceability, technical trust, liability allocation and approval from protection and indemnity clubs, all seen as prerequisites for wider carrier and bank adoption. The aim is to support scalable use of eBLs across jurisdictions and institutions, rather than isolated pilots confined to single platforms.

Bertrand Chen, chief executive of GSBN, says interoperability is central to unlocking the full value of digital trade documentation. “Interoperability is the catalyst that transforms eBLs from simple digital records into true instruments of value,” he says. By connecting eBL solution providers through a unified data and trust layer, he adds, the model supports faster, more transparent and more inclusive trade finance. Chen argues the broader objective goes beyond digitisation, describing it as “a fundamental reimagining of global trade as an interconnected digital economy,” with the next phase focused on linking documentation more closely with money movement.

The successful transaction highlights how interoperable eBLs could reduce operational friction, speed up document handling and improve connectivity between trade documentation and financing. While further work will be needed to scale adoption, the live use of multiple platforms across borders signals growing momentum behind interoperability as a foundation for digital trade finance.

 

Equity funds post record outflows in 2025 as selling eases in December

UK equity funds suffered record outflows in 2025, marking the worst year for investor withdrawals since Calastone began tracking fund flows 11 years ago, although selling pressure eased sharply in December following greater policy clarity. According to Calastone’s latest Fund Flow Index, investors withdrew a net £188m from equity funds in December, extending net selling to a seventh consecutive month. However, the December figure was the smallest monthly outflow since June and represented a marked improvement on the heavy selling seen earlier in the second half of the year.

Total equity fund outflows since June reached £10.57bn, making it the largest and most prolonged selling period on record. For 2025 as a whole, net outflows totalled £6.71bn, more than double the previous annual record of £3.34bn set in 2016, the year of the Brexit referendum.

Actively managed equity funds accounted for the bulk of the selling, shedding £18.9bn over the year. This contrasted with inflows of £12.2bn into passively managed equity strategies, making 2025 the first year since at least 2015 in which passive global equity funds proved more popular than active equivalents.

While December still saw net outflows, the pace of selling slowed considerably compared with the July to November period. During those months, concerns around potential changes to pension tax-free allowances and other investor-related measures ahead of the UK Budget drove heightened anxiety, with outflows exceeding £3.0bn in both October and November.

The improvement in December was broad-based across equity sectors. North American equity funds swung from a £812m outflow in November to a £107m inflow in December, while global equity funds recovered from net selling of £747m to inflows of £174m. UK-focused funds remained out of favour, but net outflows narrowed from £847m to £541m.

Despite UK equities reaching record highs during 2025, investors withdrew £9.55bn from UK-focused equity funds over the year, almost matching the £9.56bn withdrawn in 2024 and marking a tenth consecutive year of net selling.

Other asset classes attracted significantly stronger inflows. Diversified mixed-asset funds led the way, drawing in £11.76bn during 2025, broadly in line with their 10-year average. Money market funds also recorded a record year, with net inflows of £5.84bn, while fixed income funds attracted £1.51bn, around half the decade average amid volatile bond market conditions. All three asset classes recorded inflows in December.

Edward Glyn, head of global markets at Calastone, said: “The sudden, dramatic slowdown in outflows between November and December is a clear indicator that months of pre-Budget speculation contributed to the record outflows from equity funds between June and Budget Day. But this isn’t the whole story. Record money market inflows point to investors favouring the safety of cash, suggesting they perceive equity valuations to be teetering after a dramatic 2025 bull run. Solid inflows to mixed asset funds and fixed income support the notion that risk-off is the name of the game at present.”

 

Euro area inflation expectations steady as growth outlook softens

Euro area consumers’ views on inflation remained stable in November 2025, while expectations for economic growth became more negative and anticipated spending growth edged lower, according to the European Central Bank’s latest Consumer Expectations Survey.

Median perceptions of inflation over the previous 12 months were unchanged at 3.1% for a tenth consecutive month. Inflation expectations across all horizons also held steady. Consumers continue to expect inflation of 2.8% over the next 12 months, 2.5% three years ahead and 2.2% over a five-year horizon. Measures of uncertainty around short-term inflation expectations were likewise unchanged from October.

Differences across demographic groups persisted. Lower-income households continued to report slightly higher inflation perceptions and near-term expectations than higher-income groups, a pattern evident since 2023. Younger respondents aged 18 to 34 again reported lower inflation perceptions and expectations than those in older age brackets, although the overall direction of inflation views remained broadly aligned across income groups.

Income expectations were unchanged in November, with consumers continuing to anticipate nominal income growth of 1.2% over the next 12 months. Perceived nominal spending growth over the previous year increased marginally to 5.0%, up from 4.9% in October. However, expectations for spending growth over the coming year eased to 3.4%, down from 3.5% the previous month. Respondents in the lowest three income quintiles continued to expect slightly stronger spending growth than those in the highest two quintiles.

The survey points to a more cautious view on the broader economy. Expectations for economic growth over the next 12 months became more negative, falling to -1.3% in November from -1.1% in October. At the same time, labour market expectations improved modestly. The expected unemployment rate one year ahead declined to 10.9%, from 11.0% in October.

Perceptions of the labour market remained relatively stable. Consumers expect the future unemployment rate to be only slightly higher than the perceived current level of 10.4%, suggesting limited concern about a sharp deterioration. As in previous months, lower-income households expect significantly higher unemployment 12 months ahead, at 13.4%, compared with 9.4% among higher-income households.

For policymakers and market participants, the survey highlights anchored inflation expectations alongside a more downbeat growth outlook, reinforcing the picture of easing price pressures amid persistent economic caution across the euro area.

 

Emirates NBD issues US$1bn dual-tranche blue and green bond

Emirates NBD has completed a US$1bn dual-tranche sustainable bond issuance, comprising a US$300m blue bond with a three-year tenor and a US$700m green bond with a five-year tenor. Issued under the bank’s Euro Medium Term Note programme, the transaction represents the largest blue bond issued in the UAE and GCC, as well as the largest combined blue-green bond issued by a financial institution globally.

The proceeds are earmarked for projects aligned with environmental objectives, including marine conservation, sustainable water initiatives and climate-related activities. According to the bank, the issuance aligns with the United Nations Sustainable Development Goals, specifically SDG 14 on life below water and SDG 13 on climate action, and follows its Sustainable Finance Framework, updated in November 2025.

The dual-tranche structure reflects growing differentiation within sustainable debt markets, as issuers seek to target specific environmental themes alongside more established green financing categories. Blue bonds, which focus on ocean and water-related projects, remain a relatively small segment of the global sustainable bond market, particularly among bank issuers.

The transaction attracted demand from a range of global ESG-focused investors, indicating continued appetite for labelled sustainable debt despite more volatile market conditions in parts of 2025. The blue tranche included participation from asset managers with dedicated impact and sustainability mandates, while the green tranche broadened the overall investor base.

The bonds were structured in line with the International Capital Market Association’s Green Bond Principles and emerging guidelines for blue bonds, with defined use-of-proceeds and reporting expectations. The issuance was arranged through a public offering and will be dual listed on Euronext Dublin and Nasdaq Dubai.

The deal highlights the continued development of sustainable funding markets in the Gulf region, with banks increasingly using public bond markets to support environmental financing objectives. The size and structure of the transaction also underline the growing role of regional financial institutions in issuing benchmark-sized ESG-labelled instruments that meet international standards.

The transaction was arranged by a syndicate of international and regional banks. Emirates NBD Capital, Citibank, HSBC, Mizuho, Standard Chartered and Société Générale acted as joint lead managers and joint bookrunners, with Emirates NBD Capital and Citibank also serving as joint sustainability structurers. Legal advice to the issuer was provided by Clifford Chance, while Linklaters acted as legal counsel to the joint lead managers.

The bonds were issued via a public offering under Emirates NBD’s Euro Medium Term Note programme and will be dual listed on Euronext Dublin and Nasdaq Dubai.

 

Modulr enters US market through payments partnership with FIS

Modulr has expanded into the United States through a partnership with FIS, marking its first move into the world’s largest payments market and extending its real-time payments technology beyond the UK and Europe. The agreement will see Modulr provide payments technology to support FIS’s Money Movement Hub, a platform used by financial institutions to orchestrate domestic and cross-border payments across multiple rails. The launch reflects growing demand among banks and platforms for faster, more efficient payment infrastructure as real-time payments gain traction in the US.

Real-time payment capabilities in the US have expanded steadily since the launch of The Clearing House’s Real Time Payments system in 2017 and the introduction of the Federal Reserve’s FedNow service in 2021. While adoption has increased, access to these rails can remain complex for institutions seeking to integrate real-time payments alongside batch and cross-border services.

Under the partnership, Modulr will provide technology designed to simplify connectivity to real-time payment schemes and support banks using the FIS Money Movement Hub. The platform is built to provide a single point of access to multiple payment networks through a unified application programming interface, allowing institutions to route transactions across real-time, batch and international payment rails.

Modulr brings experience from its operations in the UK and Europe, where it participates directly in major payment schemes including Faster Payments and Bacs, as well as SEPA and Swift-linked services. The company positions this background as relevant to banks looking to modernise payment operations and support new use cases as instant payments become more widely adopted.

 

Barclays backs Ubyx to support interoperability in digital money

Barclays has made a strategic investment in Ubyx, a US-based clearing system focused on digital money, including tokenised deposits and regulated stablecoins. The move reflects growing interest among banks in infrastructure that can support emerging forms of regulated digital money as activity shifts onto blockchain-based platforms.

Ubyx is developing a clearing and acceptance network designed to enable interoperability between different forms of digital money issued by regulated institutions. The platform aims to support connectivity across tokens, blockchains and digital wallets, allowing banks and other regulated firms to interact more easily as new payment and settlement models emerge.

The investment comes amid increasing experimentation with tokenised money on public blockchain infrastructure, alongside gradual progress on regulatory clarity in several major jurisdictions. While early adoption has been most visible in cryptocurrency markets, banks and policymakers are increasingly focused on regulated use cases, including tokenised deposits and stablecoins designed to operate within existing financial frameworks.

For Barclays, the transaction aligns with broader efforts across the banking sector to understand how digital money could be integrated into traditional financial systems without undermining regulatory safeguards. Interoperability is widely seen as a key requirement if digital money is to scale beyond isolated pilots and proprietary platforms.

Ubyx’s model is built around providing a common acceptance layer for regulated digital money, supporting par-value redemption and settlement through established banking channels. Bank participation is viewed as central to this approach, particularly as financial institutions explore the potential role of digital wallets alongside conventional accounts.

For corporate treasurers and finance teams, developments in digital money infrastructure could eventually influence how liquidity is held and transferred, especially where tokenised instruments offer faster settlement or new connectivity options. However, adoption is likely to remain gradual and closely tied to regulatory developments.

 

BNI centralises trade finance operations on Finastra platform

Indonesia’s state-owned lender Bank Negara Indonesia (BNI) has consolidated its domestic and international trade finance operations onto Finastra’s Trade Innovation platform, accelerating customer onboarding and shortening approval cycles across its regional network. Following the deployment, BNI reports that customer onboarding has improved by around 25%, reflecting the impact of replacing multiple legacy systems with a single, centralised trade finance platform. The bank says the move has also created a single source of truth for reporting and improved visibility across its trade operations.

BNI selected the platform to address fragmented trade finance processes, modernise compliance workflows and enable real-time processing and analytics. Finastra provided end-to-end implementation and co-innovation services, supported by a local systems integrator to manage on-site deployment and localisation requirements.

Initially, BNI operated separate local instances for its overseas offices. The bank is now completing the migration of nine international locations onto a central instance based in Jakarta. This approach is intended to streamline group-level processing while maintaining compliance with local regulatory requirements in each jurisdiction.

Since the rollout, BNI has reported a number of operational improvements. Automated compliance workflows and increased use of straight-through processing have significantly reduced approval times, with most trade approvals now completed within one day. The bank says the platform has also enabled it to deliver certain services within service-level agreements of under three hours.

BNI reports a 10% increase in customer acquisition in the current fiscal year, supported by the digitalisation of trade services across more than 160 branches and over 2,600 trade customers. The centralised architecture is also designed to support advanced analytics, risk modelling and easier integration with fintech and artificial intelligence partners as part of the bank’s broader modernisation strategy.

For corporate clients, the changes are intended to translate into faster onboarding, quicker document processing and more consistent service levels across domestic and cross-border trade transactions.