Private bank incentives for bond deals come under pressure

Singapore

CONTROVERSIAL private bank rebates in Asian bond issues could soon become a thing of the past, after UBS stopped indulging in the practice and banks in Singapore started disclosing details of the incentives they receive.

Bookrunners routinely offer one-off rebates of 25 cents to one dollar per US$100 in face value to encourage private banks to study a bond offering and potentially recommend it to clients.

Sources said UBS had recently stopped accepting rebates on bond deals it sells to private banking clients. In Europe, the rebate is passed on to …