S'pore bond market faces S$22b refinancing bill
Bankers expect restructuring and refinancing to remain as dominant themes for 2017
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SINGAPORE dollar bonds worth S$22 billion are callable or due to mature next year, exposing issuers and investors to refinancing risks as borrowing costs rise in the US.
The US Federal Reserve last Wednesday raised policy rates by 25 basis points (bps) and surprised markets with guidance for three, instead of the expected two, rate increases next year. US Treasury yields immediately jumped 10-11 bps across the curve, pulling Singapore dollar swap offer rates (SOR) higher last Thursday morning. The five-year and 10-year SOR soared 10 bps to 2.36 per cent and 2.87 per cent, respectively, from the previous day's close.
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