May price today.
- Issuer: DBS Trustee Ltd., in its capacity as trustee of Ascott Residence Trust
- Issue: SGD Subordinated Perpetual Securities
- Issuer rating: Baa3/–/–
- Unrated, Reg S
- Call option: 2020 & on every distribution payment date thereafter at par
- Distribution: Reset at the end of year 5 & every 5 years thereafter based on prevailing SGD 5Y SOR plus the fixed spread
- Distribution step-up: None
- Distribution payment: Fixed. Semi-annually in arrear, actual/365
- Distribution deferral: At issuer’s discretion. Any deferred Distributions are non-cumulative
- Dividend stopper: Yes
- Other redemption: At par under taxation reasons, ratings event, regulatory event accounting reasons, and minimal outstanding amount
- Bookrunner: OCBC
- Information from person familiar with this offering, who is not authorized to speak publicly and asked not to be identified
OCBC will be offering trading switches to existing holders of the ARTSP 5 10/29/49, ARTSP 3.8 12/16/15 and ARTSP 4.3 11/30/18 for their concurrent participation in the new transaction.
5Y swaps at 2.18% today which gives us a premium of 2.82% for this perpetual which looks a tad thin compared to what they paid last October for their 5% SGD perpetual when 5Y rates were at 1.6%.
That 4.5 year callable ART perpetual issued last year is yielding about 4.61% to call today.
If we get that 5% coupon, this would look half decent compared to the other 2 unrated perps issued this year, namely the FCL Treasury and the Sembcorp one as well as the other FCL perp issued late last year, for its Baa3 rating.
Dividend yield of Ascott Residence Trust is 6.6%.
I say we cannot really complain.
Leaving with the list of SGD Perps and their indic yields (Sorry I left out the call dates).
