Oversea-Chinese Banking Corporation (OCBC) has priced $500 million worth of perpetual capital securities under its US $30 billion global medium term note programme.
The capital securities will be first callable in 2027.
Holders of the SGD-denominated capital securities will receive distributions semi-annually in arrear at a fixed rate of 3.90%.
The capital securities are intended to qualify as additional tier 1 capital of the bank under the requirements of the Monetary Authority of Singapore (MAS).
The net proceeds from the issue of the capital securities will be used for the bank’s general corporate purposes.
The capital securities may be redeemed on June 8, 2027 (its first reset date), or any distribution payment date falling after the first reset date.
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They may also be redeemed upon the occurrence of a tax event or if the capital securities would no longer qualify as eligible capital.
As a Basel III capital instrument, if the bank is determined by the MAS to be non-viable, the capital securities will be written off in whole or in part.
The capital securities are expected to be rated Baa1 by Moody’s, BBB- by Standard & Poor’s and BBB+ by Fitch Ratings. They will be issued on June 8.
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Credit Suisse (Singapore) Limited, OCBC Bank and Standard Chartered Bank (Singapore) Limited were the joint lead managers and bookrunners.
Shares in OCBC closed at $11.91 on June 1.
