MAS review of complex convertible bonds welcome as fundraising needs to grow

THE Monetary Authority of Singapore's decision to review the classification of non-conventional convertible bonds is a welcome one, especially as more corporates are likely to raise money from the public to deal with the fallout of the Covid-19 outbreak. It is hoped that new regulations on classifications of such bonds will make companies think twice about issuing them to retail investors.

Nominated Member of Parliament Walter Theseira had recently raised some questions about such bonds in Parliament.

The associate professor at the Singapore University of Social Sciences was concerned that retail investors may not be able to fully appreciate the complexities of this hybrid financial instrument, and wondered if such a product can be classified as suitable for them.