Retail subscription rates for Astrea 7 bonds suggest investors may be better at assessing risk than regulators think

RETAIL investors in Singapore seeking higher yielding investments had reason to cheer with the latest series of Astrea private equity (PE) bonds from Azalea Investment Management this month.

Astrea 7 – the fourth round of retail PE bonds from the Temasek-owned fund manager – marked a departure from previous issuances, with the junior Class B tranche made available to the public for the first time.

The Class B bonds came with a higher credit risk profile, but correspondingly paid a better coupon of 6 per cent per annum to compensate for the risk. Astrea 7’s senior Class A-1 tranche had a coupon of 4.125 per cent.