Singapore Exchange (SGX) and Brussels-based international central securities depository Euroclear Bank have jointly announced the launch of the Orchid bond structure in Singapore.
The structure will combine both domestic bond issuance with global distribution channels.
International investors will be able to purchase bonds issued by Singapore-based issuers on SGX’s wholly-owned subsidiary, The Central Depository (CDP) via Euroclear.
They will also benefit from real-time, multi-currency delivery versus payment (DVP) settlement with any counterparty within Euroclear’s network.
Both SGX and Euroclear says they look to extend the offering beyond Singapore to other regional issuers.
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The latest bond structure on SGX allows market participants to utilise SGX as a one-stop issuance, listing and distribution platform for regional issuance.
HSBC is the arranger, custodian bank and paying agent in the setting up of the bond structure.
Lee Beng Hong, senior managing director, head of fixed income, currencies and commodities (FICC) at SGX, says, “We are excited to partner with Euroclear to offer issuers and investors with a win-win solution, by allowing issuers to tap into SGX’s listing and depository capabilities, while at the same time giving global investors access to a fast-growing Asian bond market.”
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“Asia is home to some of the world’s fastest growing economies and we continue to see issuers tapping into debt capital markets. This offering will deepen the bond market’s liquidity pool and has the potential to significantly expand the issuers’ investor base,” Lee adds.
“This launch continues the successful momentum we have seen in the Asia region over the past year for this type of tailored solution. Within our ecosystem we see continued scope for this structure laying the foundation for ESG bond issuance in foreign currencies in the near future,” says Stephan Pouyat, global head of capital markets and funds services at Euroclear.
Shares in SGX closed 4 cents lower or 0.4% down at $9.91 on Feb 18.