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Singapore Bonds

Runifyouhaveto

Alfrescian
Loyal
Meltdown in local O&G bond prices, approximate-yields

>25%pa Yield (considering price below value)
Swiber 5.55%
Vallianz 7.2%

>20%pa Yield (considering price below value)
Vallianz 7.25%
Otto 7%
Ezra 8.75%

>15%pa Yield (considering price below value)
Swiber 6.25%
Swiber 6.5%
Swiber 7%

>10%pa Yield (considering price below value)
Ezra 4.875%
Falcon 5.5%
Mencast 5.5%
Geo Resources Energy 7%

Compare: Greek govt bonds is 15% yield
 

bart12

Alfrescian
Loyal
Stock vs corporate bond on 6-29

2015-06-29 stockvsbond.png
 

dancingshoes

Alfrescian
Loyal
Just hide in those good short-term SGD bonds that matures in less than 3 years

i think it's a wise choice, our economic cycle is getting shorter, that meaning is safer to invest in short term bonds rather than 10 year ones, cos' too many things can happen in a long time.
 

Runifyouhaveto

Alfrescian
Loyal

Runifyouhaveto

Alfrescian
Loyal
OCBC Bank SGD PerpNC5 Additional Tier 1 - IPG @ 4% area

Source: http://www.reuters.com/article/2015/08/18/ocbc-debt-bonds-idUSL3N10T17720150818
SINGAPORE, Aug 18 (IFR) - Oversea-Chinese Banking Corporation has kicked off bookbuilding on its first Basel III-compliant Additional Tier 1 issue, which is expected to generate keen interest.

The non-cumulative, non-convertible perpetual with a call at year five is being marketed at a guidance of 4 percent area.

There is a reset to a new fixed rate equal to the five-year Singapore dollar SOR plus the initial spread.

The trigger event will be when either the Monetary Authority of Singapore notifies the bank that a write-off is necessary or the MAS decides on a public sector injection of capital. When this happens, a partial or full writedown will be imposed on the bondholders.

Just my 0.02... ...
OCBC is a safe bank
However, AT1 is a riskier type of perpetual bonds from the OCBC, it will be prioritized next to Coco Bonds in the event that the bank faces $$$ problem.
4% is indicative, it is likely that they will priced it at 3.x% eventually.
The yield is very low, OCBC launched 4%(final pricing) Perp Bond a few years ago when SIBOR was lower.
 

Runifyouhaveto

Alfrescian
Loyal
Comparisons:

OCBC Max.4% - Renowned local bank
Giti Tire 6% - Major Tire manufacturer in Indonesia and China, opening US factory
FCL 3.65%- Property giant owned by Thai tycoon Charoen with significant interest in expanding Australian business


OCBC
Yield: Max 4% (to be confirmed)
Duration - Non-Callable 5 years, Perpetual
Bond Denominations - 250K

Giti Tire 6%
Yield: 6%
Duration - 3 Years (appx. 27 more months), Non-perpetual
Bond Denominations - 250K

FCL 3.65%
Yield: 6%
Duration - 7 Years (appx. 80 more months), Non-perpetual
Bond Denominations - Retail-size (small)
 

Runifyouhaveto

Alfrescian
Loyal
is it a good deal?

Nothing wrong with it as OCBC is very safe
but they brought Wing Hang (China Exposure), so we dunno if they will face write-offs in future like DBS's rendezvous with Dao Heng Bank.

Risk:
if our local banks collapse like Irish banks
(There are rumours of a tough 2016 year for banks - http://sammyboy.com/showthread.php?212383-Singapore-After-The-Next-Election&p=2256350#post2256350 )
then u face massive capital losses because AT1 bonds are riskier than normal bonds.
Redemption is likely but not guaranteed

If nothing happens,
4% for 5 years in a raising interest-rate environment is also less attractive now.
4% is good if it was for retail tranche, but this is 250K a pop.

That's why i cited another 2 bonds for comparison purposes.
 

Runifyouhaveto

Alfrescian
Loyal
OCBC priced $500m NC5-AT1 bonds at 3.8%
http://infopub.sgx.com/FileOpen/OCBC_S$AT1_Capital_Securities-Pricing_Announcement_18Aug2015.ashx?App=Announcement&FileID=365789

Not much meat for bond investors
 

Runifyouhaveto

Alfrescian
Loyal
Re: Interesting Bond issues

Thanks, good warning. I was surprised to see the news this morning. Caveat emptor.

In some quarters, debt-interests payment wipe out a huge part of their profit-margins

They can upsize the bond issue to $150m from $50-75m
It is like watever u apply (give them), they will take.

Just my 2 cents, please check with your financial advisors
 

eErotica69

Alfrescian (InfP)
Generous Asset
Re: Interesting Bond issues

Bro run, what you think of the Aspiral 5-year Bond at 5.25% interest? You think it will be over subscribed?

I am seriously thinking of bidding at least $50K.
 
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