In December 2014, the Monetary Authority of Singapore (the “MAS”) and Singapore Exchange Limited (the “SGX”) issued a second set of consultation papers containing:
- Draft legislation to effect the policy proposals to facilitate bond offerings to retail investors; and
- Proposed Listing Rules requirements on trustee, trust deed and continuing listing obligations for bonds listed on the Singapore Exchange Securities Trading Limited (the “SGX-ST”).
The consultation period for both Consultation Papers ended on 23 January 2015.
In September 2014, the MAS and SGX issued two consultation papers setting out the policy proposals to provide retail investors with greater access to bonds through the following channels, subject to conditions to safeguard retail investors’ interests (the “First Consultation Papers”):
- Seasoning Framework: Under the Seasoning Framework, retail investors can purchase bonds that were initially offered to institutional investors, accredited investors and investors in amounts of at least S$200,000 after a six-month period (the “Seasoning Period”). After the Seasoning Period, plain vanilla bonds offered by issuers who satisfy the SGX’s eligibility criteria may be made available to retail investors via secondary trading on the SGX-ST (the “Seasoned Bonds”).
- Re-tapping: After the Seasoning Period, issuers who satisfy the SGX’s eligibility criteria may also offer new bonds to retail investors which have the same terms as the Seasoned Bonds.
- Exempt Bond Issuers: Issuers who satisfy stricter eligibility criteria than that under the Seasoning Framework may offer plain vanilla bonds to retail investors at the start of an offer without a prospectus.
On 23 December 2014, the MAS and SGX issued their responses to feedback received on the First Consultation Papers. Taking into account the feedback received, the MAS and SGX will proceed to implement these proposals with refinements. The revised proposals are set out in the second set of Consultation Papers issued by the MAS and SGX in December 2014.
The SGX has indicated that the Seasoning Framework and the proposed amendments to the trustee and trust deed requirements are targeted for implementation by first half of 2015
December Consultation Papers
- MAS Second Consultation Paper: Draft Legislation to Effect the Policy Proposals to Facilitate Bond Offerings to Retail Investors
- SGX Second Consultation Paper: Initiatives to Improve Retail Access to Debt Securities: Trust Deed Requirements
MAS and SGX Responses