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Investors Welcome for First Singapore Savings Bonds
World Economy

Investors Welcome for First Singapore Savings Bonds

Retail investors can apply for the first issue of the much-anticipated Singapore Savings Bonds from September 1, said the Monetary Authority of Singapore on Tuesday.
The first savings bonds will be issued on October 1 and MAS said it could potentially issue between $2 billion to 4 billion worth of such bonds this year, depending on demand, NewsNow reported.
“A new Savings Bond will be issued every month for at least the next five years, so there is no need to rush for the first issuance,” MAS managing director Ravi Menon told a press conference on the release of the central bank’s latest annual report.
In a media release later on Tuesday, MAS said it will issue a public notice on Sept 1 giving information on the first bond issue, including the amount on offer and the interest pay-out schedule from the 1st to the 10th year.
The notice will be published after 4.30pm on the savings bonds website (www.sgs.gov.sg/savingsbonds). The website will also feature tools to help investors keep track of application timelines and understand the returns from investing in savings bonds over different investment periods.
In order to apply for savings bonds, investors must have an account with participating banks, namely DBS/POSB, OCBC or UOB and an individual CDP Securities account with direct crediting service, to allow the bond payments to be made directly into the bank account.
The launch of the savings bonds is one part of an initiative by MAS to improve the savings and investments options for retail consumers.
“This has been a problem in Singapore - we just don’t have enough of these simple, low-cost investment products to put our monies in,” Menon said earlier Tuesday.
Besides introducing the savings bonds, MAS has over the year also made it easier for retail investors to access more exchange-traded funds by revising their rules.
MAS is also working with the Singapore Exchange to reduce the cost of retail bond issuance and make it easier for investors to buy corporate bonds, which traditionally have a low take-up rate among retail investors.

 Growth Forecast
The MAS and the ministry of trade and industry are reviewing their growth forecast for the economy for 2015, but MAS said the growth momentum is not expected to deteriorate further in the second half-year.
Menon said the review will take into account the economy’s weaker performance in the first half of the year as well as support factors in the second half.
Looking ahead, Menon said MAS would continue to closely monitor three key risks in the external environment. They are Greece, whose situation remains highly uncertain; China, where the downside risk has increased; and, the Asean region, where financial conditions could tighten sharply when the US Federal Reserve raises interest rates.

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