Oversea-Chinese Banking Corporation (OCBC) has priced US$750 million ($1.03 billion) worth of fixed rate subordinated notes, which are to be drawn down under its US$30 billion global medium term note programme.

The USD-denominated notes are expected to qualify as the bank’s Tier 2 capital under the Monetary Authority of Singapore’s (MAS) requirements.

The notes are priced at 100% and will carry a coupon of 4.602% per annum (p.a.) from the issue date to the call date on June 15, 2027.

If the notes are not redeemed, the interest rate from the call date to the maturity date on June 15, 2032, will be reset to a fixed rate per annum equal to the aggregate of the then-prevailing five-year US Treasury Rate and 1.575%.

The notes are expected to be rated A2 by Moody’s, BBB+ by Standard & Poors and A by Fitch Ratings. They will be issued on June 15.

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The notes may be written off in whole or in part if OCBC is determined by the MAS to be non-viable.

They may also be cancelled, modified, converted, be subject to a change in form or have a similar effect if a right of modification, conversion, or change of form had been exercised by the MAS.

Barclays Bank, Citigroup Global Markets, JP Morgan Securities and OCBC Bank were the joint lead managers and bookrunners.

Shares in OCBC closed 1 cent lower or 0.08% down at $11.89 on June 8.

OCBC prices US$750 mil of tier 2 subordinated notes with 4.602% p.a. coupon

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OCBC prices US$750 mil of tier 2 subordinated notes with 4.602% p.a. coupon

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