UOB planning sale of US$-denominated bonds

UNITED Overseas Bank is planning a sale of dollar-denominated bonds as Asia's investment-grade issuers pay the least for debt in the US currency in almost three years.

UOB, which is rated AA- by Standard & Poor's, the company's fourth-highest grade, hired banks for an offering of subordinated notes, a person familiar with the matter said yesterday, asking not to be identified because the terms aren't set. Yield premiums on securities graded the equivalent of BBB- or higher by S&P slid to 190.5 basis points last week, the lowest since April 2011, according to JPMorgan Chase & Co indices. Investment-grade borrowers pay 41.5 basis points more than Treasuries for dollar notes globally, Bloomberg indices show.

HSBC Holdings was the last high-grade Asian issuer to sell dollar-denominated bonds, pricing US$300 million of floating-rate notes on March 7. The region's banks have sold US$8.38 billion of debt this year, 26 per cent of total dollar issuance, data compiled by Bloomberg show. South Korea's Shinhan Bank, rated A by S&P, is considering a transaction as it plans to meet investors in Asia, Europe and the US from Thursday, a separate person said yesterday.