26/02/2016

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Banks bidding for HDB’s largest bond issue

Banks are bidding for the largest issue yet from Housing and Development Board (HDB), totalling up to S$1.6 billion, IFR reported Friday (15 January).

According to the report by the Thomson Reuters publication, the HDB asked banks for proposals to sell a seven-year bond for a target size of S$1 billion and a S$600 million greenshoe. “If it does achieves the maximum deal size, it will beat its largest single issue, when it sold a S$1.5 billion 1.875 percent four-year issue in November 2013.”

Bids are due for submission on Monday (18 January).

The Singapore statutory board obtained its first rating in October 2015, when Moody’s gave it the top rate Aaa, increasing its appeal to banks’ asset liability management desks.

IFR said the rated HDB notes will now have a zero risk-weighting and qualify as Level 1 high-quality liquid assets under the Monetary Authority of Singapore’s (MAS) rules on liquidity coverage ratios, adding that previously, the unrated notes qualified as a Level 2 HQLA and were subject to a 15 per cent haircut under LCR rules.

Source copied from: http://www.propertyguru.com.sg/property-management-news/2016/1/115202/banks-bidding-for-hdbs-largest-bond-issue

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