Singapore Bond House

IFR Asia Awards 2016
2 min read
Daniel Stanton

In a tough year for the local debt market, DBS continued to work hard for issuers and investors and reaffirmed its leadership in bringing high-quality foreign issuers to Singapore.

DBS deepened the market by matching yield-hungry investors with issuers looking for new pockets of demand. It offered investors an alternative to local mid-cap issuers with subordinated and callable deals from well-known borrowers. It was ever-present on Singapore’s benchmark issues and kept markets open through private placements, even in volatile conditions.

Manulife’s S$500m 10-year non-call five Tier 2 subordinated issue was a standout deal. The relatively investor-friendly regulations for Canadian life insurance capital meant that investors did not have to worry about the risk of conversion to equity. Investors were happy with a yield of 3.85%, while the issuer also locked in a low cost of funding for regulatory capital.

The deal was the first from a foreign insurance company in Singapore dollars, and drew the biggest order book of the year.

Other foreign financial institutions also came to the market to raise regulatory capital. National Australia Bank returned for another Tier 2 issue, while DBS also brought the likes of ABN AMRO, Julius Baer and BPCE to Singapore, adding variety while offering healthy yields to investors.

It performed solidly with core local issuers, too, landing roles on Housing Development Board’s S$1bn seven-year issue in January, S$675m return in April, and S$700m print in August, as well as offerings for local blue-chips like Starhub, Singtel and Ascendas, some of them on a sole basis.

When investors turned to duration in search of more yield, DBS brought corporate perpetual bonds from the likes of Citic Envirotech, Mapletree Logistics Trust and Keppel REIT.

Supranationals and agencies have not been frequent issuers in Singapore dollars, but DBS was sole arranger when Asian Development Bank and Germany’s KfW accessed the market, as well as a joint bookrunner for Korea Development Bank’s S$200m print in December 2015.

Even when primary markets were essentially closed, DBS managed to lead large private placements for a variety of issuers, such as Singapore Airlines, Starhill Global REIT and Ascendas Hospitality Trust.

In tough conditions, DBS managed to top the league table with S$6.9bn of deal credit, giving it a market share of 37%.

Turbulent market conditions also gave DBS the opportunity to show its skills in liability management, with consent solicitations or tenders for Religare Health Trust, Eu Yan Sang, G8 Education and Ezra, among others.

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