Singapore’s MAS to raise S$2.6bn bonds to fund infrastructure

Out-Law News | 29 Sep 2021 | 1:03 am |

The Monetary Authority of Singapore (MAS) has announced plans to raise S$2.6 billion (US$1.9bn) in its inaugural sale of bonds to fund infrastructure projects.

Institutional and individual investors were able to bid in the auction, which took place on 28 September, according to an MAS auction notice.

James Harris of Pinsent Masons MPillay, the Singapore joint law venture between MPillay and Pinsent Masons, the law firm behind Out-Law, said: “This capital raising follows earlier announcements and supports the Singapore government’s long-standing intention to develop a hub for all aspects of financing infrastructure projects. It is further evidence of the evolution of the markets in Asia becoming more and more self-sufficient when it comes to these types of capital raising.”

MAS will announce the interest payments on the bond scheduled to expire in October 2051 one hour after the auction and the bond will be issued for trade in secondary market on 1 October.

It is the first Singapore Government Securities (SGS) bond issued under the Significant Infrastructure Government Loan Act (SINGA), which was proposed in February and approved by the Singapore’s president in June.

The government will be able to borrow up to S$90bn to pay for infrastructure which will last at least 50 years. The annual interest limit for such borrowings cannot exceed S$5bn, and each project funded under the law must be sizeable with a cost of at least S$4bn