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Wait a minute 3.85%?
might as well go hide in City Development NCCP, giving 3.9cents per share (3.4% yield)
AND if City Development redeems, can enjoy bonus payouts (appx 90% capital gain at current conversion price).
Remarks: City Development NCCP has no fixed redemption dates. More suitable for estates, retirees and parents park children' s savings.
Have a good week ahead gentlemen!
might as well go hide in City Development NCCP, giving 3.9cents per share (3.4% yield)
AND if City Development redeems, can enjoy bonus payouts (appx 90% capital gain at current conversion price).
Remarks: City Development NCCP has no fixed redemption dates. More suitable for estates, retirees and parents park children' s savings.
Have a good week ahead gentlemen!
MarcPh ( Date: 27-Jun-2017 18:07) Posted:
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Wah!!! 3.85% coupon for new Perennial bonds!
http://infopub.sgx.com/FileOpen/PREHL%203rd%20MTN%20Launch%20Annc%2027%20June%2017%20Final.pdf.ashx?App=Announcement& FileID=459084
Historical low coupon for Perennial. Ho Bee sure buay tahan and follow suit.
http://infopub.sgx.com/FileOpen/PREHL%203rd%20MTN%20Launch%20Annc%2027%20June%2017%20Final.pdf.ashx?App=Announcement& FileID=459084
Historical low coupon for Perennial. Ho Bee sure buay tahan and follow suit.
Very smart move by Perennial to keep the issue size smaller (appx $100-120mio) today.
Doing so, they managed to crash the yield to sub-4%. Let' s see what' s the final number and issue size.
With a Sub-4% coupon, Perennial is gonna join the league of Guocoland and Wing Tai. Just one notch below City Development and Capitaland.
Well done guys!
Doing so, they managed to crash the yield to sub-4%. Let' s see what' s the final number and issue size.
With a Sub-4% coupon, Perennial is gonna join the league of Guocoland and Wing Tai. Just one notch below City Development and Capitaland.
Well done guys!
MarcPh ( Date: 27-Jun-2017 09:51) Posted:
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Noble Group declines as Fitch sees real possibility of default
http://www.businesstimes.com.sg/companies-markets/noble-group-declines-as-fitch-sees-real-possibility-of-default
In the eyes of investors and banks, last week' s announcement pertaining defaulting on the perp bond is a massive negative credit event.
Even strong commodity house are retrenching in Singapore this year, without compensation.
But guess what? the bond prices recovered slightly this week as this possibility has been priced in. The share just dropped a bit AND a way higher than a few weeks ago. I guess Noble' s investors need some closure to move on. Hope Noble secure a good price for their North American oil assets/pipes.
http://www.businesstimes.com.sg/companies-markets/noble-group-declines-as-fitch-sees-real-possibility-of-default
In the eyes of investors and banks, last week' s announcement pertaining defaulting on the perp bond is a massive negative credit event.
Even strong commodity house are retrenching in Singapore this year, without compensation.
But guess what? the bond prices recovered slightly this week as this possibility has been priced in. The share just dropped a bit AND a way higher than a few weeks ago. I guess Noble' s investors need some closure to move on. Hope Noble secure a good price for their North American oil assets/pipes.
An active bond issuer Perennial is back in the bond market!
Indicative yield is low-4% for their new 3Y bonds. Coupon is marginally higher than their current 2020 retail bonds. Not much push-factor for retail investors, as they can get net yield of appx 4% from the 2020 retail bonds from the market in smaller denominations. However, 3Y is just nice for most Accredited Investors who buys with leverage (shorter maturity than perp bonds)
I was expecting Perennial to issue longer-dated perp bonds to lock-in the current low interest-rates.
Indicative yield is low-4% for their new 3Y bonds. Coupon is marginally higher than their current 2020 retail bonds. Not much push-factor for retail investors, as they can get net yield of appx 4% from the 2020 retail bonds from the market in smaller denominations. However, 3Y is just nice for most Accredited Investors who buys with leverage (shorter maturity than perp bonds)
I was expecting Perennial to issue longer-dated perp bonds to lock-in the current low interest-rates.
According to this morning' s announcement, the retap increased the total issue size is US$355mio, cost of financingfor Oxley is estimated to erode EPS by 1.0x cents per ordinary share annually.
MarcPh ( Date: 23-Jun-2017 11:45) Posted:
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OCC is a finance subsidiary of OCBC bank, used for capital-raising purposes.
This is a very safe issue. Unlike newer Additional Tier-1 bonds from bank, OCC 5.1% does not loss-absorption feature. Technically, AT1 bonds from banks risked being converted to equities are high-prices when a bank' s capital adequacy ratio (CAR) falls below certain level, resulting in massive losses. If you have it, please consider holding it till maturity or offload it for additional 3-3.5% capital gain + accrued interests.
If you don' t have it, maybe give it a miss as the net yield is less than 1.5 to 2%pa now because it is likely to be recalled 14 months later. Recent local banks and blue-chips launches perp bonds at 4% range, and OCBC will likely recall it on the coupon reset date on August 2018 as a sign of financial strength. (Failure to recall on coupon reset dates might destroy OCBC' s creditability)
For 1.5 to 2%pa yield before commission, maybe just lock the money in Maybank' s 18-mth fixed deposits promo at 1.45%pa.
This is a very safe issue. Unlike newer Additional Tier-1 bonds from bank, OCC 5.1% does not loss-absorption feature. Technically, AT1 bonds from banks risked being converted to equities are high-prices when a bank' s capital adequacy ratio (CAR) falls below certain level, resulting in massive losses. If you have it, please consider holding it till maturity or offload it for additional 3-3.5% capital gain + accrued interests.
If you don' t have it, maybe give it a miss as the net yield is less than 1.5 to 2%pa now because it is likely to be recalled 14 months later. Recent local banks and blue-chips launches perp bonds at 4% range, and OCBC will likely recall it on the coupon reset date on August 2018 as a sign of financial strength. (Failure to recall on coupon reset dates might destroy OCBC' s creditability)
For 1.5 to 2%pa yield before commission, maybe just lock the money in Maybank' s 18-mth fixed deposits promo at 1.45%pa.
john_ric ( Date: 23-Jun-2017 16:30) Posted:
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any comments on occ 5.1% ncps???........
occ = ocbc??
occ = ocbc??
Oh! Oxley trying to retap for another time for the same USD 6.375% bond today.
Current issue size US$300mio
Earlier comments on this issue
- According the last financial report, Oxley' s total borrowings & debts is $2.38bio, of which about $928mio is due within 12 months,
- Total Equity is $1.08bio and development properties held in balance sheet is valued at $1.924bio. Others include investment properties and company facilities (properties & plants)
- Going forward, we cannot assume the property-based assets in balance sheet will not face any write-down or FX adjustment against SGD.
Current issue size US$300mio
Earlier comments on this issue
- According the last financial report, Oxley' s total borrowings & debts is $2.38bio, of which about $928mio is due within 12 months,
- Total Equity is $1.08bio and development properties held in balance sheet is valued at $1.924bio. Others include investment properties and company facilities (properties & plants)
- Going forward, we cannot assume the property-based assets in balance sheet will not face any write-down or FX adjustment against SGD.
MarcPh ( Date: 08-May-2017 10:31) Posted:
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paiseh, post it here more relevant
A perpetual 4D ticket... ...Pay Once and bet until you win.
Background
I was looking at properties and realized that I do not have enough money and current rental yields is less than 3%pa or less than 1%pa if you include bank loan interest, maintenance and depreciation. In the midst of research, I found a substitute that requires a smaller quantum and offers the same benefits and regular income stream like property.
PS: Of course buying a property is good for long-term capital appreciation, eg. 100% in 10-20 years. I am not telling you not to buy properties. But this substitute appears to be very suitable for your kids or seniors in your family to park their savings.
City Development Preference Shares (Retail) CityDev NCCPS
It was issued about 14 years ago. City Dev issued it to utilize some tax-credits. THERE IS NO REDEMPTION DATE for this Preference Share, not even a call-date (to redeem). This preference share will might never be redeemed.
Then what is the catch?
Benefits
For every share, it gives 3.9 cents annually:
This is easier than buying a property.
Frequently Asked Questions
1: What if City Development redeems their preference shares at current level?
Congrats, it is a windfall.
2. What if City Development redeems their preference shares when their ordinary shares crashed?
If City Development ordinary shares crashed to $3.50 or below during a recession, I think a lot of blue-chips will be priced at a small-fraction of today' s value. The money from redemption payment can be used to buy other blue-chips eg. Banks, cheaply.
3: What if City Development never redeem their preference shares?
- It is still a good 3.5% tax-free income (comparable with rental incomes).
- In 2007, the company hinted about the redemption and the preference share shot up to $2.
- In 2012, the company hinted about redemption and the preference share shot up to almost $1.20.
- There are always chances to sell for a decent profit even without redemption.
- The historical low is $0.80 (for only a few days). 80% of the time, this share trades at appx $1.10 level and 10-15% of the time, it trades higher than that. (Offering a profitable exit before redemption)
Pros:
- Tax-free regular income and hassle-free with potential capital gains when redeemed
- Investment grade company like our local banks, safer than Capitaland
- Better than insurance. Bonus payouts for insurance happens only with our death, and we don& rsquo t need to bet our lives to enjoy a bonus payout.
- This is the only financial instrument of such nature in Singapore from a reputable issuer. Most people or estates, just buy and keep with their spare cash.
Cons:
- City Development might never redeem it (forever)
- City Development might default on the coupon (non-cumulative) but the cost of paying the interests annually is less than $13mio (chicken-feet) for City Dev. If they cannot pay preference shares dividend, all dividends for ordinary shares will automatically cease for that year.
- There are only small quantity available for sale daily (good sign), you have to accumulate this counter slowly.
- If you need the money urgently (to cash out), you might lose a bit of capital (or make a tiny bit).
DISCLAIMER:
Lose money don' t blame me. I am not financially trained, broke and don' t even have a bachelor' s degree.
LOL I intend to cheat my Mother-in-law money into this counter and park my kids' s savings there
Give your kids this perpetual 4D ticket.
A perpetual 4D ticket... ...Pay Once and bet until you win.
Background
I was looking at properties and realized that I do not have enough money and current rental yields is less than 3%pa or less than 1%pa if you include bank loan interest, maintenance and depreciation. In the midst of research, I found a substitute that requires a smaller quantum and offers the same benefits and regular income stream like property.
PS: Of course buying a property is good for long-term capital appreciation, eg. 100% in 10-20 years. I am not telling you not to buy properties. But this substitute appears to be very suitable for your kids or seniors in your family to park their savings.
City Development Preference Shares (Retail) CityDev NCCPS
It was issued about 14 years ago. City Dev issued it to utilize some tax-credits. THERE IS NO REDEMPTION DATE for this Preference Share, not even a call-date (to redeem). This preference share will might never be redeemed.
Then what is the catch?
Benefits
For every share, it gives 3.9 cents annually:
- If it never redeems, this is a good income for CPF-OA account (only 2.5% return).
- It is good for my children savings (only 0.1% from POSB).
- It is good for retirement (City Development is reliable). The current price is $1.12-$1.14, with a 3.9 cents payout annually, the yield is about 3.5%pa.
- City Development ordinary share is worth about $11 now, so any redemption NOW will see a $2.13 payout (100% gain)
- If City Development ordinary share crashed to $3.50 (Armageddon), the redemption payout will be $1.12 (current cost). You can probably buy a lot of blue-chips cheaply with the payout when City Development crashes to $3.50.
This is easier than buying a property.
Frequently Asked Questions
1: What if City Development redeems their preference shares at current level?
Congrats, it is a windfall.
2. What if City Development redeems their preference shares when their ordinary shares crashed?
If City Development ordinary shares crashed to $3.50 or below during a recession, I think a lot of blue-chips will be priced at a small-fraction of today' s value. The money from redemption payment can be used to buy other blue-chips eg. Banks, cheaply.
3: What if City Development never redeem their preference shares?
- It is still a good 3.5% tax-free income (comparable with rental incomes).
- In 2007, the company hinted about the redemption and the preference share shot up to $2.
- In 2012, the company hinted about redemption and the preference share shot up to almost $1.20.
- There are always chances to sell for a decent profit even without redemption.
- The historical low is $0.80 (for only a few days). 80% of the time, this share trades at appx $1.10 level and 10-15% of the time, it trades higher than that. (Offering a profitable exit before redemption)
Pros:
- Tax-free regular income and hassle-free with potential capital gains when redeemed
- Investment grade company like our local banks, safer than Capitaland
- Better than insurance. Bonus payouts for insurance happens only with our death, and we don& rsquo t need to bet our lives to enjoy a bonus payout.
- This is the only financial instrument of such nature in Singapore from a reputable issuer. Most people or estates, just buy and keep with their spare cash.
Cons:
- City Development might never redeem it (forever)
- City Development might default on the coupon (non-cumulative) but the cost of paying the interests annually is less than $13mio (chicken-feet) for City Dev. If they cannot pay preference shares dividend, all dividends for ordinary shares will automatically cease for that year.
- There are only small quantity available for sale daily (good sign), you have to accumulate this counter slowly.
- If you need the money urgently (to cash out), you might lose a bit of capital (or make a tiny bit).
DISCLAIMER:
Lose money don' t blame me. I am not financially trained, broke and don' t even have a bachelor' s degree.
LOL I intend to cheat my Mother-in-law money into this counter and park my kids' s savings there
Give your kids this perpetual 4D ticket.
MarcPh ( Date: 19-Jun-2017 17:42) Posted:
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Double-confirmed that Asian High-Yield Bond market is recovering.
Kaisa sank the Chinese bond markets just a year ago and now back to tap the market with various 7-9% yield bond issues.
Kaisa sank the Chinese bond markets just a year ago and now back to tap the market with various 7-9% yield bond issues.
BREAKING NEWS:
The trust is broken, Noble defaulted on US$12mio perp bonds coupon payment. They know the rules of the game they had lost their credibility to issue unsecured debts in the forseeable future. The much-awaited bond consent solicitation didn' t happen and they just default. Now, there are more coupons due for Noble' s plain vanilla bonds in July.
The decision to defer payment of the coupon on its US$400 million perpetual securities, due June 26, worried investors, who said the failure to pay US$12 million sent a negative signal and suggested lenders may have asked the group to defer payment where possible. Shares slipped after a sharp rise on Monday.
" While non payment of the perpetual bond coupon will not trigger a default event, it is a further hit to the company' s reputation. This is hurting investor confidence," said one Hong Kong-based analyst, who declined to be named.
http://www.businesstimes.com.sg/companies-markets/indebted-noble-confirms-bank-loan-relief-but-skips-coupon-payment
The trust is broken, Noble defaulted on US$12mio perp bonds coupon payment. They know the rules of the game they had lost their credibility to issue unsecured debts in the forseeable future. The much-awaited bond consent solicitation didn' t happen and they just default. Now, there are more coupons due for Noble' s plain vanilla bonds in July.
The decision to defer payment of the coupon on its US$400 million perpetual securities, due June 26, worried investors, who said the failure to pay US$12 million sent a negative signal and suggested lenders may have asked the group to defer payment where possible. Shares slipped after a sharp rise on Monday.
" While non payment of the perpetual bond coupon will not trigger a default event, it is a further hit to the company' s reputation. This is hurting investor confidence," said one Hong Kong-based analyst, who declined to be named.
http://www.businesstimes.com.sg/companies-markets/indebted-noble-confirms-bank-loan-relief-but-skips-coupon-payment
Nam Cheong Trading Halt but strictly speaking, the announcement don' t apply to the 3 Nam Cheong Bonds
- $90mio due 28Aug2017 Corp
- $75mio due 23Jul2018 Corp
- $200mio due 26Aug2019 Corp
Quick Take on latest Wing Tai Perp bonds (indicative yield 4.35%, probably priced near 4.0%)
In comparison, Wing Tai 2022 Bonds (5 more years) has a yield of appx 3.5%pa now. (plain vanilla bonds, not Perp)
If you love the new Wing Tai perp bonds, you may wish to tell your RM or central dealer that you will not subscribe for it if the coupon is less than 4.0%.
Otherwise you feel like a stupid, getting just 0.5% for all the (low) risk of holding a perp issue instead of plain vanilla bond from Wing Tai.
In comparison, Wing Tai 2022 Bonds (5 more years) has a yield of appx 3.5%pa now. (plain vanilla bonds, not Perp)
If you love the new Wing Tai perp bonds, you may wish to tell your RM or central dealer that you will not subscribe for it if the coupon is less than 4.0%.
Otherwise you feel like a stupid, getting just 0.5% for all the (low) risk of holding a perp issue instead of plain vanilla bond from Wing Tai.
New Bond Issue
Wing Tai Perp Bonds (Perpetual!!! Not again
)
Indicative: 4.35% (expect priced closer to 4%).
Cumuluative, Coupon Reset and Callable in Year 5, Coupon Step up in Year 10
Wing Tai Perp Bonds (Perpetual!!! Not again
)Indicative: 4.35% (expect priced closer to 4%).
Cumuluative, Coupon Reset and Callable in Year 5, Coupon Step up in Year 10
Hi John,
Once a upon a time, HDB bonds used to yield 3-4%pa*. So there was a retail market for HDB or JTC bonds 15-20 years ago. These days, bond-yields had dropped so much that financial institutions (insurers and banks) are the main buyers of HDB bonds. These bonds are usually rated AAA, just like Nowegian or Singapore govt bonds and being a " technically loss-making" on paper, HDB bond offers 25-30bp more than other AAA issues. Under BASEL III framework, such AAA bonds are considerd high-quality liquid asset for their liquidity ratio coverage. http://www.bis.org/publ/bcbs238.pdf
Yes, HDB bonds ain' t really for the man on the street or even the rich individuals. Of course, if you love speculating, I heard of rich people who got 100% leverage for HDB bonds (buying an insurance policy as collateral) and just betting on the difference between cost-of-financing (SOR) and the HDB bond coupon. SOR was negative 1-2 years ago.
*I recommended something of 3-4% yield in another thread on 16th June. HDB is just 2.2%pa for 10-15 years.
http://sharejunction.com/sharejunction/listMessage.htm?directAccessMessageID=1382189
Once a upon a time, HDB bonds used to yield 3-4%pa*. So there was a retail market for HDB or JTC bonds 15-20 years ago. These days, bond-yields had dropped so much that financial institutions (insurers and banks) are the main buyers of HDB bonds. These bonds are usually rated AAA, just like Nowegian or Singapore govt bonds and being a " technically loss-making" on paper, HDB bond offers 25-30bp more than other AAA issues. Under BASEL III framework, such AAA bonds are considerd high-quality liquid asset for their liquidity ratio coverage. http://www.bis.org/publ/bcbs238.pdf
Yes, HDB bonds ain' t really for the man on the street or even the rich individuals. Of course, if you love speculating, I heard of rich people who got 100% leverage for HDB bonds (buying an insurance policy as collateral) and just betting on the difference between cost-of-financing (SOR) and the HDB bond coupon. SOR was negative 1-2 years ago.
*I recommended something of 3-4% yield in another thread on 16th June. HDB is just 2.2%pa for 10-15 years.
http://sharejunction.com/sharejunction/listMessage.htm?directAccessMessageID=1382189
john_ric ( Date: 19-Jun-2017 16:59) Posted:
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why are ppl buying so low yied bonds? for example HDB 1.47%.
hahaha, business times also confirmed that bond rally is back
http://www.businesstimes.com.sg/banking-finance/sgd-bonds-rally-key-interest-rates-fall-after-fed-rate-hike
http://www.businesstimes.com.sg/banking-finance/sgd-bonds-rally-key-interest-rates-fall-after-fed-rate-hike
MarcPh ( Date: 15-Jun-2017 10:56) Posted:
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- Sembcorp priced their new perp bonds at 3.7%.
- European banks price their SGD AT1 Perps coupons lower than USD.
- Perps from our blue chips are giving < 4% yields now!!!
The article appears to be right that the company is seeking maturity extension to buy time - Speculating 5o dispose majority stake in CH Offshore. The Consent Solicitation Exercise will also seek waives on financial covenants.
MarcPh ( Date: 14-Jun-2017 14:51) Posted:
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