Demand for Singapore Savings Bond falls sharply in 3rd issue

Demand for Singapore Savings Bond falls sharply in 3rd issue
POSTED: 26 Nov 2015 22:00

SINGAPORE: The third issue of the Singapore Savings Bond saw scant interest from investors, who applied for only a small fraction of the maximum available.

The Monetary Authority of Singapore (MAS) said on Thursday (Nov 26) that for the December issue, total application within individual allotment limits amounted to S$40.99 million, well below the maximum allotment of S$1.2 billion.

The application amount was down sharply from S$257 million for the previous month's issue and S$413 million for the first tranche.

Singapore Savings Bonds offer individuals a safe, long-term, flexible savings option that pays higher interest over time.

For the December issue, the bond will pay investors an average interest rate of 2.44 per cent if it is held for the full 10 years.

In the second tranche, investors could earn an average interest rate of 2.78 per cent over a 10-year tenure, while the first issue would pay an average interest rate of 2.63 per cent.

Investors can choose to redeem Singapore Savings Bonds monthly at face value, unlike in the case of conventional bonds whose market price can fluctuate.

- CNA/xq

- wong chee tat :)