Singapore signs its largest foreign currency digital bond

By Monica Muema

Singtel, UOB and ADDX have signed Singapore’s largest foreign currency digital bond. The US$100 million, five-year digital Sustainability-Linked Bond (SLB) is a partnership by Singtel’s wholly-owned subsidiary, Singtel Group Treasury (SGT), with UOB and ADDX.

The deal was first announced in November last year, when Singapore’s central said it would start a project on the technological aspects of building a digital form of its currency to prepare for the days if the city-state decides to have one

The SLB will carry a US$ fixed coupon rate of 3.56% per annum and will mature on 27 April 2027.

The Singtel Group has committed to reducing its absolute greenhouse gas emissions (Scope 1 and 2 in tCO2e) by 2025, compared to a 2015 baseline.

If the stated target is not met, the Singtel Group will, by the maturity date of the SLB, make additional investments into defined green efforts of an amount equal to not less than 0.25% of the outstanding aggregate principal amount of the SLB.

UOB is the lead manager for the issuance and the entire SLB will be tokenised on the digital securities exchange ADDX.

Digital bonds, or tokenised bonds, are issued using blockchain and smart contract technology in order to eliminate manual processes throughout different stages of the security’s life cycle, including issuance, distribution, custody and post-trade servicing.