SIA to sell five-year bonds worth S$300m dollars

Createwealth8888: It just tells me that many investors are still more risk-averse and capital protection is the most important than returns. 2.15 per cent for 5 years.

---------------------------------------------------

SINGAPORE: Singapore Airlines (SIA) said it will sell five-year bonds worth S$300 million dollars.


The bonds will offer a return of 2.15 per cent and will comprise a Public Offer and a Placement.

The public offer will amount to S$50 million dollars.

Retail investors can subscribe to the bonds though DBS, OCBC and UOB ATMs.

This is the first time a corporate institution is making its bonds available to retail investors.

Bond issuances made in Singapore are usually offered to institutions and wealthy investors.

In a statement, one of the coordinating bookrunners, OCBC said this public offer will now offer retail investors an opportunity to put their money into an alternative instrument compared to areas like equities and structured deposits.

Nicholas Tan, OCBC Bank's Head of Global Wealth Management, said: "Retail bond offering is an attractive alternative for a retail investor looking for higher yield and a steady stream of income in the current low interest rate environment.

"Typically, a bond pays a higher coupon than a savings account. In addition, in a low interest rate environment where bond prices can potentially keep rising, an investor can also look towards potential capital gains.

"As more companies start to offer retail bonds, investors will be presented with more choices. However, investors must be aware that each bond may present different level of risk depending on the credit worthiness of the issuer.

"They must also be aware that the price of the bond will change in line with interest rates. Lastly, buying a bond at issue and holding it until maturity means investors must be prepared to commit their funds for that length of time." - CNA/fa