ADB launches US$10 Billion
Asian Currency Note Programme
SINGAPORE (14 September 2006) – The Asian Development Bank (ADB)
today launched a US$10 billion Asian Currency Note Programme that will
serve as the first regional platform dedicated to issuances of bonds
in regional currencies.
The programme is Asia's first multi-currency bond platform since
the 1997 Asian financial crisis that links the domestic capital markets
of Singapore and Hong Kong, China, as well as later on Malaysia and
Thailand. Under the scheme, Asian currency bonds are issued in their
domestic markets under a single unified framework with a common set
of documents governed by English law.
DBS is the mandated regional arranger for the programme and sole lead
manager and bookrunner for the Singapore dollar issue. The bookrunners
and sole lead managers for the Hong Kong dollar issue are HSBC, and
for the Thai baht issue Standard Chartered and Bank of Ayudhya.
The inaugural issue under the programme involves the issue by ADB of
S$300 million five-year Singapore dollar notes in Singapore and HK$1
billion three-year Hong Kong dollar notes in Hong Kong, China to be
printed before the end of the week. ADB also plans to issue THB6.5 billion
of 5 and 10-year Thai Baht bonds shortly once approvals are obtained.
While the Thai Baht notes will not yet be issued under the programme,
the Thai Government has provided its in-principle approval for including
Thailand in the programme in the very near future. Similarly, the Malaysian
Government has signaled its intention to allow ADB to include Malaysia
under the programme structure.
"The programme is a significant milestone for Asian capital market
development and for ADB," says ADB Vice-President Khempheng Pholsena.
“It is a logical continuation of ADB's market-opening transactions
in Asian local currency bond markets over the last three years and fully
in line with ADB's support to the ASEAN+3 Bond Market Initiative."
The scheme was established through the close coordination with and
support of regulators from Hong Kong, China; Malaysia; Singapore; and
Thailand. It allows a leading issuer like ADB to launch a larger bond
issue by tapping several Asian financial markets simultaneously under
a single unified framework. Such a single structure not only provides
significant savings in terms of legal and transaction costs, but also
allows issuers to tap into regional markets as and when market opportunities
arise without the need to seek new approvals for each and every issue.
The programme is structured to accommodate other markets in the region
as and when the terms are approved by regulators. “We hope that
this programme will contribute to creating a unified platform which
will eventually include the entire region. In our view, the programme
signals the potential for Asian capital markets to address Asia's
own large funding needs", says ADB Treasurer Mikio Kashiwagi.
He notes that the programme will allow regional and global issuers
to simultaneously tap bond markets in the region expeditiously and contribute
significantly to the deepening of bond markets in Asia.
“The format of a linked, multi-location, multi-currency financing
can be applied to other leading issuers, including Asian or multinational
corporate issuers seeking to simultaneously access a large base of investors
across Asia's leading capital markets," says Clifford Lee,
Managing Director of Debt Capital Markets at DBS.
Jackson Tai, Chief Executive Officer of DBS adds that Asia is becoming
the centre- stage for capital formation and is increasingly providing
funds for the rest of the world.
“With the ‘ADB format' and the foresight of regulators
from Singapore, Hong Kong, Thailand and Malaysia, underwriters from
DBS, HSBC and Standard Chartered were able to construct a virtual link
of Asia's capital markets to bring scale and investor demand across
regulatory borders to serve a leading issuer," he says. "In
the future, leading issuers will not be limited by the constraints of
any one Asian capital market, whether it be size, currency or investor
appetite."
About ADB
ADB, based in Manila, is dedicated to reducing poverty in the Asia
and Pacific region through pro-poor sustainable economic growth, social
development, and good governance. Established in 1966, it is owned by
66 members - 47 from the region. In 2005, it approved loans and grants
for projects totaling $6.95 billion, and technical assistance amounting
to $198.8 million. Visit the ADB website at www.adb.org.
About DBS
Headquartered in Singapore, DBS is one of the largest financial services
groups in Asia with operations in 15 markets. The largest bank in Singapore
and the fifth largest banking group in Hong Kong as measured by assets,
DBS' "AA-" and "Aa2" credit ratings are among
the highest in the Asia-Pacific region. DBS has leading positions in
consumer banking, treasury and markets, asset management, securities
brokerage, equity and debt fund raising. Beyond the anchor markets of
Singapore and Hong Kong, DBS serves corporate, institutional and retail
customers through its operations in China, India, Indonesia, Malaysia,
Thailand and The Philippines. More information about DBS Group Holdings
and DBS Bank can be obtained from the website www.dbs.com.
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