OCBC prices S$550 million perpetual capital securities at 4.5%

OCBC has priced S$550 million in perpetual capital securities at 4.5 per cent per annum, first callable in 2029.

The capital securities will be issued on Aug 15 under the bank’s US$30 billion global medium-term note programme, it said on Tuesday (Aug 8).

Holders will receive distributions on a semi-annual basis.

Subject to approval from the Monetary Authority of Singapore, the bank may redeem the capital securities on Feb 15, 2029 – the first reset date, or any distribution payment date after.

It may redeem the capital securities if a tax event commences, or if the capital securities no longer qualify as eligible capital.

If the capital securities are not redeemed on the first reset date, the distribution rate will be reset on that date and every five years thereafter to a fixed rate per annum equal to the sum of the five-year Singapore Overnight Rate Average Overnight Indexed Swap at that time and an initial spread of 1.3348 per cent.

The capital securities qualify as Additional Tier-1 capital for the bank, it said, adding that net proceeds will be used for general corporate purposes.

OCBC also expects the capital securities to be rated Baa1 by Moody’s Investors Service, BBB- by Standard & Poor’s Rating Services and BBB+ by Fitch Ratings.

It is the sole lead manager and bookrunner for the issue.

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OCBC shares closed up 0.6 per cent or S$0.08 at S$13.02 on Monday.