DBS Global Income Note raises over SGD 1 billion in three months
DBS Global Income Note aims to provide stable, consistent income in times of uncertainty; sees strong private banking client interest since January launch
SINGAPORE,10 May 2019 -
DBS today announced the successful introduction of the DBS Global Income Note (“the note”), which has raised over SGD 1 billion in three months following its launch in January 2019. As the hunt for yield continues to dominate in a lower-for-longer environment, the note presents a timely solution for income investors seeking capital preservation and a stable, consistent source of income.
The open-ended structured note references the DBS Global Income Portfolio. The latter is a globally diversified and equally weighted portfolio of at least 100 mostly investment-grade bonds across geographies and sectors. Every month, the portfolio is rebalanced, and its average duration is adjusted using interest rate derivatives to manage portfolio interest rate risk in line with the DBS Chief Investment Office’s (CIO) target duration. In addition, all underlying bonds are monitored closely by DBS Group Research and DBS fixed income analysts on an ongoing basis.
The DBS Global Income Note is designed to be a cornerstone of investors’ portfolios through the economic cycle. It has a current payout of around 4.25% per annum in USD, and provides high income visibility and transparency as it pays out coupons collected (less structuring fees and costs) to investors on a quarterly basis. It is also available in an SGD-hedged format. The minimum investment sum is USD 50,000 or SGD 100,000. In comparison, the minimum trade size for a single non-retail bond is SGD 250,000.
Said Audra Seah, Head of Investment Advisory and Capital Markets, DBS Private Bank, “With the hunt for yield remaining a consistent theme amid falling interest rates, narrowing credit spreads and the inverted yield environment we’re seeing today, we believe the launch of the DBS Global Income Note is timely. Fully conceptualised, structured and managed in-house at DBS, the note effectively demonstrates how DBS’ ‘One Bank’ proposition is able to leverage expertise across the bank to deliver a unique income instrument.”
The note is structured by DBS’ investment advisory and capital markets team, with the underlying portfolio of bonds selected based on DBS CIO’s investment guidance and target duration, and the credit research expertise of DBS Group Research and DBS fixed income analysts.
“Demand for the DBS Global Income Note has been exceedingly strong, which speaks to the solid track record that we have established. We structured the DBS Global Income Note to address income investors’ need for greater stability and certainty by providing access to a highly diversified fixed income portfolio for a relatively small investment amount. In addition, by including only actively-monitored and mostly investment-grade bonds, we relieve investors of the need to keep close tabs on their portfolio, which would be challenging and time-consuming in today’s increasingly volatile environment.”
The DBS Global Income Note is available to accredited investors from DBS Private Bank and DBS Treasures Private Client.
DBS is a leading financial services group in Asia with a presence in 18 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world.
Recognised for its global leadership, DBS has been named “Global Bank of the Year
” by The Banker and “Best Bank in the World
” by Global Finance. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank
” by Euromoney. In addition, DBS has been accorded the “Safest Bank in Asia
” award by Global Finance for ten consecutive years from 2009 to 2018.
DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets. DBS is committed to building lasting relationships with customers, and positively impacting communities through supporting social enterprises, as it banks the Asian way. It has also established a SGD 50 million foundation to strengthen its corporate social responsibility efforts in Singapore and across Asia.
With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. The bank acknowledges the passion, commitment and can-do spirit in all of our 27,000 staff, representing over 40 nationalities. For more information, please visit www.dbs.com