What is to expect from SGS infra bonds?

A maiden $2.6b SGS (Infra) bond will be auctioned on September 28.

According to a report by OCBC Bank, $2.6b worth of 30-year SGS (Infra) bond will be auctioned on 28 September 2021.

These bonds will be issued on 1 October. The infrastructure bonds on offer will be on par with the SGS (Market Development) Bonds.

A low risk is expected from the bonds due to full backing from the Singapore government. A yield curve and market liquidity similar to the SGS (MD) would also mean similar pricing. Interest costs would also come from the government’s annual budget. 

Retail investors also have an option of investing in portions of $1,000 in SGS (Infra) or $250,000 for corporate bonds.

However, the long tenor can be less attractive, with future SGS (Infra) bonds may see a longer duration of 40-50 years.