Home Crypto DBS Bank Issues $15M Digital Bonds through DBS Digital Exchange

DBS Bank Issues $15M Digital Bonds through DBS Digital Exchange

Singapore-based financial institution DBS Bank introduced the issuance of digital bonds value 15 million SGD (US$11.3 million) in its first security token offering (STO).

DBS Bank will concern digital bonds with a maturity of 6 months and an annualized coupon fee of 0.6% through its Digital Exchange (DDEx).

Unlike the standard public bond improvement method, this digital bond issuance was accomplished by non-public placement. And DBS Bank is the one book-runner for this transaction. Compared with conventional wholesale bonds, the face worth will typically require roughly SGD 250,000 and multiples of the funding and transaction quantity.

To encourage buyers to take part extra broadly, DBS Bank has lowered the usual accordingly, and digital bonds will probably be traded at 10,000 Singapore {dollars} per lot.

DBS Digital Exchange (DDEx) was launched in December 2020, aiming to make use of blockchain expertise to offer prospects with a protected and clear complete digital asset ecosystem buying and selling platform.

The financial institution acknowledged that DDEx had loved sturdy market attraction since its launch. DBS Bank additionally acknowledged that its digital bonds conform to the present bond authorized framework. Investors don’t want to fret about authorized points and supply the identical authorized certainty and rights safety as conventional bonds.

Head of Capital Market Group Eng-Kwok Seat Moey acknowledged: 

 “Our maiden STO itemizing on the DBS Digital Exchange is a big milestone, because it highlights the energy of our digital asset ecosystem in facilitating new methods of unlocking worth for issuers and buyers.

Clifford Lee, Global Head of Fixed Income at DBS, acknowledged that the issuance of digital bonds could be an vital step in conventional bond issuance to a extra inclusive digital ecosystem. He added that:

“While most bond tokenization workouts introduced in Asia up to now are usually repackaged types of a traditional bond concern, the present transaction instantly combines current authorized and tax infrastructure necessities with a direct issuance on the digital change in smaller lot sizes.”

This bond token construction was solely made potential due to the progressive improvement of Singapore’s authorized and tax infrastructure, which may facilitate extra STO issuances to broaden and deepen our capital markets.

With the itemizing and buying and selling of digital bonds on DDEx, these securities can now be secondary traded between accredited buyers and establishments which are DDEx members or relevant finish prospects.

On May 14, DBS financial institution announced that the corporate has began providing belief companies for cryptocurrencies, permitting their premium shoppers to incorporate the rising asset class of their succession plans.

Image supply: Shutterstock

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