MAS launches first sovereign green bond, aims to raise up to $2.4b with 50-year debt

SINGAPORE – Singapore’s central bank looks to raise between $1.9 billion and $2.4 billion with its first sovereign green bond issuance, according to a notice issued on its website on Thursday (Aug 4).

The Green Singapore Government Securities (Infrastructure), or Green SGS (Infra), has a tenor of 50 years – the first time the Singapore Government is issuing bonds with such a long maturity period. 

The price and yield, or interest payments, will be determined through an intra-day book-building process, and will be announced in a notice published on the Monetary Authority of Singapore’s (MAS) website later on Thursday.

Up to $2.35 billion is being offered via a placement to institutional and other investors, and $50 million will be offered to the public in Singapore through electronic applications.

MAS reserves the right to set the final issuance amount, and it may at its sole discretion reallocate the aggregate principal amount of bonds offered between the placement and public offer.

For institutional and other investors, applications for bonds under the placement must be made with a minimum of $200,000 and in multiples of $1,000.

The opening and closing dates of the public offer will be disclosed in the pricing notice later in the day as well.

Retail investors applying for the public offer bonds must do so with a minimum of $1,000 and in multiples of $1,000.

The notice on MAS’ website stated that the coupon payment dates will be on Feb 1 and Aug 1 of each year up to and including the maturity date, with the first coupon payment date on Feb 1, 2023.

Green SGS (Infra) is governed by the Singapore Green Bond Framework and issued under the Significant Infrastructure Government Loan Act, which was passed in Parliament last year.

This inaugural sovereign green bond is part of a pipeline of up to $35 billion of sovereign and public sector green bonds that the Singapore Government and its statutory boards will issue by 2030.

Proceeds from the sale of the green bond will finance projects with environmental benefits, including the Jurong Region Line and Cross Island Line.

This is the first time that MAS is issuing a bond via the syndication process, which involves the appointment of a group of banks, or bookrunners, to jointly market and distribute a bond.

The bookrunners for this issuance are DBS Bank, Deutsche Bank, HSBC, OCBC Bank and Standard Chartered Bank.