FINANCIAL SERVICES | Staff Reporter, Singapore

DBS Group launches first Basel III-compliant bond issue

The $250m notes will have a coupon of 3.8%.

DBS Group Holdings (DBSH) revealed that it has successfully priced the issue of its $250m fixed-rate callable bonds, its first Basel III-compliant Tier 2 issue.

The notes, which are due on 2028 and bear a fixed interest rate of 3.8% per year, are expected to be issued on January 20, 2016 and are expected to qualify as Tier 2 capital of DBSH and its subsidiaries, subject to the requirements of the Monetary Authority of Singapore.

DBS said that the net proceeds from the issue of Notes will be used for the finance and treasury activities of DBSH, including the provision of intercompany loans or other forms of financing to its subsidiaries. 

If the Notes are not redeemed on January 20, 2023, the interest rate from that date will be reset at a fixed rate per annum of the then-prevailing 5-year Swap Offer Rate and 1.10 per cent.

The Notes are under DBS Group's USD 30 billion Global Medium Term Note Programme. The Notes are expected to be rated A2 by Moody's Investors Service and A+ by Fitch Ratings Ltd.  

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