Singapore Savings Bond fourth tranche to be capped at S$300m

SINGAPORE — The Monetary Authority of Singapore (MAS) announced yesterday that up to S$4 billion of Singapore Savings Bonds (SSB) will be offered for the whole of next year.

The first SSB for next year — the fourth tranche to date — will be capped at S$300 million, down from the S$1.2 billion maximum set for previous issues.

Applications for the latest bond, which will be issued on January 4 next year, close on Dec 28.

Only individuals can apply for the SSBs, which are fully backed by the Government. People can invest the minimum sum of S$500 and in subsequent multiples of S$500 up to a maximum of S$50,000 in any single issue.

The interest rates are on a step-up basis: The longer the SSB is held, the higher the returns will be. The bonds have a 10-year tenor and funds can be redeemed early on a monthly basis without penalty.

The bonds will pay a coupon of 1.21 per cent in the first year, stepping up every year to 3.69 per cent in the 10th year.

According to MAS, the average return for investors who hold the latest bond for the full 10 years is 2.58 per cent per annum. This is higher than the 2.44 per cent for the previous issue, but below the 2.78 per cent for the second issue.