SGX Attracts Diverse Bond Listings In May

• SGX continues to draw a strong flow of new bond listings in 2014 with 41 new debt securities introduced to the exchange in May.
• Banglalink Digital Communications became the first Bangladeshi issuer to tap the international bond market with a debut US$300 million five-year-non-callable three senior note.
• Hainan Airlines’ RMB1.7 billion three-year bond was the first offshore RMB corporate bond issue to be cleared in Singapore and deposited with SGX’s Central Depository.

SGX continued to attract a strong flow of new bond listings in May, supported by a geographically diverse suite of transactions. A total 41 new bond issues were listed on SGX in the month, down from the 56 listed in April. Non-US dollar bonds accounted for 46% of the new listings in May, compared with 32% in April while the percentage of non-Singapore issuers accounted for 73%, slightly down from 75% over that period. In May, 63% of SGX-listed bonds issued had tenors of more than three years, broadly in line with the year-to-date proportion of about two thirds (this proportion fell to 55% in February).

Highlights

New Entrant

The development of Asia’s corporate bond sector has helped bring to market a range of new issuers from frontier markets. In May, Banglalink Digital Communications, Bangladesh’s largest wireless telecom operator, became the first issuer from the South Asian nation to tap the international bond market with its debut US$300 million five-year-non-callable three senior note issuance with a coupon rate of 8.625% coupon. The transaction was listed on SGX on 7 May.

First Offshore RMB Corporate Bond cleared in Singapore

SGX also saw its first Chinese corporate’s offshore RMB-denominated bond cleared in Singapore and deposited with SGX’s Central Depository (CDP) in May. Hainan Airlines’ 1.7 billion RMB bond with a coupon at 6.25% maturing on 22 May 2017 was also listed on the exchange on 23 May. Singapore’s increasing profile as an offshore RMB hub outside greater China complemented by SGX’s expanding suite of RMB and China-related products and services makes SGX a choice venue for offshore RMB transactions. To date, approximately 100 offshore RMB bonds are listed on SGX by geographically diverse issuers.

Convertible bonds

As a global exchange, SGX’s listing framework supports a wide range of bond structures, including convertible and exchangeable bonds. Convertible bonds are debt securities that can be converted into common stock in the issuing company after a certain number of years. Convertible bonds can be listed on SGX, even if the underlying stock is listed on another exchange outside Singapore. Over the past year, issuance of convertible bonds has increased with Japanese and Chinese issuers notably active. Convertible and exchangeable bonds account for about 13% of bonds listed on SGX. Recent bond listings include GCL Poly-Energy Holdings’ USD200 million 2018 0.75% convertible note, The Joyo Bank’s USD300 million 2019 zero coupon convertible bond and AYC Finance’s USD300 million 0.5% 2019 exchangeable bond.

SGX Fixed Income

SGX's fixed income market is organised into two main segments: the retail bond market and the wholesale bond market. SGX-listed retail bonds are offered to the public and traded on the exchange's Mainboard in much the same way stocks are. SGX-listed wholesale bonds are only distributed to institutional or accredited investors in larger denominations and are primarily traded over-the-counter. More information on SGX-listed debt securities can be found here.

Debt Securities (with ≥ USD750 million issue size) listed on SGX in May 2014: