Singapore Bonds

Re: Interesting Bond issues

Pacific Andes’ SGD 200 million ($160m) bonds “sold like hot cakes”, a source told the Singaporean business newspaper Business Times. The frozen fish supplier has received orders exceeding SGD 2 billion for its three-year issue, the source told the newspaper............The bonds are due on July 30, 2017 and will bear interest at the rate of 8.5% per annum, payable semi-annually.
http://www.undercurrentnews.com/2014/07/24/pacific-andes-bonds-sold-like-hot-cakes

Oversubscribed by >$1.8bn but such phenomenon can be misleading. The grey market prices didn't surge despite such mad book-building; it is struggling to stay above 100.

Re: Interesting Bond issues

SINGAPORE: The local corporate debt market grew strongly in 2013 with its volume rising 18 per cent from the end of 2012, and total debt issuance rising by 38 per cent, the Monetary Authority of Singapore (MAS) said on Friday (July 25).

http://www.channelnewsasia.com/news/business/singapore-s-corporate/1282052.html

Re: Interesting Bond issues

no wonder so many companies issuing bonds...

Runifyouhaveto said:

SINGAPORE: The local corporate debt market grew strongly in 2013 with its volume rising 18 per cent from the end of 2012, and total debt issuance rising by 38 per cent, the Monetary Authority of Singapore (MAS) said on Friday (July 25).

http://www.channelnewsasia.com/news/business/singapore-s-corporate/1282052.html

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Re: Interesting Bond issues

New Issues in high demand
Strong demand for new issues buoyed Asian credit markets today as investors continued to chase higher-yielding bonds.
http://in.reuters.com/article/2014/07/25/markets-asia-debt-idINL4N0Q02U520140725

Re: Interesting Bond issues

Runifyouhaveto said:

Pacific Andes’ SGD 200 million ($160m) bonds “sold like hot cakes”, a source told the Singaporean business newspaper Business Times. The frozen fish supplier has received orders exceeding SGD 2 billion for its three-year issue, the source told the newspaper............The bonds are due on July 30, 2017 and will bear interest at the rate of 8.5% per annum, payable semi-annually.
http://www.undercurrentnews.com/2014/07/24/pacific-andes-bonds-sold-like-hot-cakes

Oversubscribed by >$1.8bn but such phenomenon can be misleading. The grey market prices didn't surge despite such mad book-building; it is struggling to stay above 100.

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Ah run, where to buy? Or is these 250k a pop bond. If price now is .99, yield is at 9.5%. 3 years, I think is god buy.

Re: Interesting Bond issues

lifeafter41 said:

Ah run, where to buy? Or is these 250k a pop bond. If price now is .99, yield is at 9.5%. 3 years, I think is god buy.

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it is a more risky bond. imho, if you have an investment appetite for risky bonds, you can consider similiar alternatives reits or foreign-currency denominated bonds; their fluctuation is also about 8-15% a year (gain/loss)

Ok, if you really like, you can find your bank RM or some hardworking remisiers will also handle. 250k a lot.
inclusive of commission, i think you will pay around 100-100.5 based on yesterday's price.

Re: Interesting Bond issues

Is there something wrong with our present financial market?

Notice that many companies are issuing short term bonds of 3 years and 5 years at very high rate. For example, Pacific Andes just issued a 3 year bond of $200 mil @ 8.5% and Olam, a 5 year bond of $100 mil @ 4.25%. Notice also some 30 year bonds are having yield around 4%.. are we having a inverted yield situation where shorter-term rates are equal or higher than longer-term rates ?
US Treasury has known to have liquidity squeeze when the yield curve is inverted. A a recession is to follow soon after.

Re: Interesting Bond issues

revealer said:

Is there something wrong with our present financial market?

Notice that many companies are issuing short term bonds of 3 years and 5 years at very high rate. For example, Pacific Andes just issued a 3 year bond of $200 mil @ 8.5% and Olam, a 5 year bond of $100 mil @ 4.25%. Notice also some 30 year bonds are having yield around 4%.. are we having a inverted yield situation where shorter-term rates are equal or higher than longer-term rates ?
US Treasury has known to have liquidity squeeze when the yield curve is inverted. A a recession is to follow soon after.

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here's my 2 cents

Is there something wrong with our present financial market?
Yes, 2 unhealthy phenomenon:
1. money is nearly free - interest rates at historical lows
2. Crazy interests in bonds since the beginning of 2014 - something is going to happen


Notice that many companies are issuing short term bonds of 3 years and 5 years at very high rate. For example, Pacific Andes just issued a 3 year bond of $200 mil @ 8.5%
Assuming, these are riskier companies; if they offer mid/long-term bonds, they might have to pay >10% a year = higher cost of financing.


and Olam a 5 year bond of $100 mil @ 4.25%.
Olam is now 50% temasek-owned. Market perceived them to have lower default risk. Their bonds used to be 6-8%.
For high risk bonds, RUN would rather invest in OCBC NISP indonesia bonds for 10% yield instead of Olam or Pacific Andes.


Notice also some 30 year bonds are having yield around 4%.
You could be refering to sovereign debts or APPLE's bonds. otherwise, most will have give higher yields for such long-term debts.


are we having a inverted yield situation where shorter-term rates are equal or higher than longer-term rates ? US Treasury has known to have liquidity squeeze when the yield curve is inverted.
This is not happening yet. The last time it happened was right after subprime.


A a recession is to follow soon after.
We are now in the final-leg of a post subprime bull market. I project equity upside for another 8-10 weeks. If the market nose-dives after 8-10 weeks, I agree with you that a recession will soon follows. If the market continues to rally after 10 weeks from now, who knows, Dow may be able to cross 20000?

Bond investors shouldn't bet on any of these projections. The best bets now will be short-term bonds from premium/safe issuers. If market don't crash, they enjoy a 4-5%pa yield. If market crashes, they can take back 100% par and switch to cheap properties or shares 2-3 years later.

Re: Interesting Bond issues

I see it as a matter of time that we will see inverted yields developing. It was said that Bernanke has messed up the financial market, creating some distortions in the yield curve. This Bloomberg report said that the yield gap btw the 5-year and 30-year has narrowed to level last seen in 2009.. as investors are betting on gains in five-year notes, raising it to the highest level in a year. It appears to suggest that the US is about to face some stresses in the liquidity..

http://www.bloomberg.com/news/2014-...alls-to-least-since-2009-on-growth-views.html

At the Corporate level, things could happen quickly and differently...have a feeling that we may be experiencing yield of short term to be narrowing, equal or higher than longer term bonds... It is agreeable that the higher yield differences btwn Pacific Andes and Olam are mainly due to differences in risk valuation..

Re: Interesting Bond issues

this coupon rates are fantastic!!!even better than dividend stocks,but i do not have 250k to gamble on a single issue.....is there a bond index fund i can buy?with high high yield.

Re: Interesting Bond issues

frenchbriefs said:

this coupon rates are fantastic!!!even better than dividend stocks,but i do not have 250k to gamble on a single issue.....is there a bond index fund i can buy?with high high yield.

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high yield comes with junk bonds.
But got one very risk free fund you can invest, guaranteed bao jiak. guess the fund

Re: Interesting Bond issues

Care for Pinoy Fund?

SamSeng said:

high yield comes with junk bonds.
But got one very risk free fund you can invest, guaranteed bao jiak. guess the fund

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Re: Interesting Bond issues

Runifyouhaveto said:

here's my 2 cents

Is there something wrong with our present financial market?
Yes, 2 unhealthy phenomenon:
1. money is nearly free - interest rates at historical lows
2. Crazy interests in bonds since the beginning of 2014 - something is going to happen


Notice that many companies are issuing short term bonds of 3 years and 5 years at very high rate. For example, Pacific Andes just issued a 3 year bond of $200 mil @ 8.5%
Assuming, these are riskier companies; if they offer mid/long-term bonds, they might have to pay >10% a year = higher cost of financing.


and Olam a 5 year bond of $100 mil @ 4.25%.
Olam is now 50% temasek-owned. Market perceived them to have lower default risk. Their bonds used to be 6-8%.
For high risk bonds, RUN would rather invest in OCBC NISP indonesia bonds for 10% yield instead of Olam or Pacific Andes.


Notice also some 30 year bonds are having yield around 4%.
You could be refering to sovereign debts or APPLE's bonds. otherwise, most will have give higher yields for such long-term debts.


are we having a inverted yield situation where shorter-term rates are equal or higher than longer-term rates ? US Treasury has known to have liquidity squeeze when the yield curve is inverted.
This is not happening yet. The last time it happened was right after subprime.


A a recession is to follow soon after.
We are now in the final-leg of a post subprime bull market. I project equity upside for another 8-10 weeks. If the market nose-dives after 8-10 weeks, I agree with you that a recession will soon follows. If the market continues to rally after 10 weeks from now, who knows, Dow may be able to cross 20000?

Bond investors shouldn't bet on any of these projections. The best bets now will be short-term bonds from premium/safe issuers. If market don't crash, they enjoy a 4-5%pa yield. If market crashes, they can take back 100% par and switch to cheap properties or shares 2-3 years later.

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Hi run, how to buy the ocbc nisp. Thanks!!

Re: Interesting Bond issues

A BIG THANK YOU TO BOSS SAM TO HELP ME ADJUST THE THREAD TITLE


In appreciation of Boss Sam's help, RUN will make his first aftermarket secondary bond recommendation for our retiree friends here to park their money.

Cheung Kong 5.125% Perpetual
http://em.cbonds.com/emissions/issue/20655
Lot Size: S$250K
Last Friday's Price: About 99 to 99.1 (including commission), excluding accrued interests.
Maturity: 2 more years (first-call date)

Advantage:
- The yields are high because this bond was issued years ago when interest rates were higher.
- Company owned by Mr Li Ka Shing's Cheung Kong Group. Cheung Kong Group owns properties and utility companies in HK.
- The parent company is ultra-rich now after offloading lots of assets in the past 1 year + their recent property launch is crazily oversubscribed in HK although property market is weak (they sold in micro 200sqft units). It is always safer to lend money to people who don't need to borrow.
- If they redeem back 2 years later, you enjoy 5.125%pa for 2 years + 1% bonus because it is trading below 100.

Risk:
- This is a shell-company based in offshore islands (for tax purposes), not based in Singapore or HK. (different jurisdiction).
- They are not legally obliged to redeem perpetual bonds. If they don't redeem back after on first-call date, you just continue to get 5.125%pa but the company's overal1 credit worthiness will be affected.


Objective: Buy bonds from safe issuers with short maturity. When property and market crashes 2-3 years later, switch from the matured bonds at 100% par to grab the bargains.

I is difficult to find such a good catch (safe company with 5% yield) with short maturity (2 years). Please note that RUN is not a professional or uni grad, therefore please seek your RM's advice on the underlying risks. That's all I know.


Please support our community. I hardly can find any place such so many locals anymore.

Re: Interesting Bond issues

lifeafter41 said:

Hi run, how to buy the ocbc nisp. Thanks!!

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OCBC NISP had a good 11.35% issue in 2010
http://www.ocbc.com.sg/assets/pdf/C...11.35 Subordinated Bonds III due 2017 TCs.pdf

1. Please check with your bank's RM on the underlying risk.
2. It is not issued in Singapore, so you need a custodian account with your bank.
3. It is not issued in Singapore, please check if there's any tax on dividend/interest incomes.
4. It is not listed in Singapore, I do not know the price or premium that you have to pay = slightly lower yield than 11.35%
5. Being listed in foreign currency, you might enjoy additional FX gain or loss.

This is certainly better than risking money in riskier marine and offshore issuers because non-leveraged bond issuers would prefer to park money in safer issues.

Of course, you can also wait for new ones too.
http://www.thejakartaglobe.com/business/bank-ocbc-nisp-mulls-bond-sale-to-boost-lending-activities
but it think the yield will not be as good as the 2010 issue.

Re: Interesting Bond issues

frenchbriefs said:

this coupon rates are fantastic!!!even better than dividend stocks,but i do not have 250k to gamble on a single issue.....is there a bond index fund i can buy?with high high yield.

Click to expand...

Safer bonds come with lower yield 3-6%pa. An index or unit trust manager fees will wipe out another 0.5-1.5% (costs).
Currently, nearly all of the good performing bond funds of 4-6% yields contains non-SGD bonds = FX risk.

Therefore it is better to DIY for bonds (retail or secondary market) because the yields of good 100% SGD bond index/unit trusts are too low.
For small denominations, you can buy from SGX's mainboard.
We can wait for Temasek's retail bond or safe "covered bonds" from banks in the near future (possible to get 2-5%pa even in small denominations)

Three S'pore banks to sell covered bonds soon
http://business.asiaone.com/news/three-spore-banks-sell-covered-bonds-soon

Re: Interesting Bond issues

garlic said:

Care for Pinoy Fund?

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Considering that this is like a super long-term safe bond. The fund is perfect if the yields for all account is set at 4%pa.

Re: Interesting Bond issues

revealer said:

I see it as a matter of time that we will see inverted yields developing.

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For our friends who are interested in the technicalities, when inverted yields develop, bond prices generally nose-dive.

But short-maturity bonds from safe issuers are assumed to be redeemed back at 100% par, so the capital loss is much smaller if you are forced to offload a few months before maturity. If you managed to wait till redemption = no capital loss and you can switch any of the following:

1. Inverted yield curve = bonds big crash
2. Inverted yield curve = property big crash
3. Inverted yield curve = equities big crash

Re: Interesting Bond issues

10-Years Spanish Bond Yields Tumble Below 2.5% - Lowest In History
http://www.zerohedge.com/news/2014-07-28/spanish-bond-yields-tumble-below-25-lowest-history

2.5% for Spanish 10Y, there are so many bonds from good issuers that gives better yields that we discussed in this thread
OCBC 4% Pref is also 10Y, RUN will rather choose OCBC

Re: Interesting Bond issues

Runifyouhaveto said:

Safer bonds come with lower yield 3-6%pa. An index or unit trust manager fees will wipe out another 0.5-1.5% (costs).
Currently, nearly all of the good performing bond funds of 4-6% yields contains non-SGD bonds = FX risk.

Therefore it is better to DIY for bonds (retail or secondary market) because the yields of good 100% SGD bond index/unit trusts are too low.
For small denominations, you can buy from SGX's mainboard.
We can wait for Temasek's retail bond or safe "covered bonds" from banks in the near future (possible to get 2-5%pa even in small denominations)

Three S'pore banks to sell covered bonds soon
http://business.asiaone.com/news/three-spore-banks-sell-covered-bonds-soon

Click to expand...

i am interested to buy the three Singapore bank bond.But i do not have bank remisier. what can i do?
i dont think my net asset is enough to apply for private banking leh.