MAS unveils new Singapore Savings Bonds for local investors

To help locals with retirement planning.

The Monetary Authority of Singapore today introduced the Singapore Savings Bonds (SSB), a new type of Singapore Government Securities (SGS) that aims to encourage individual investors to tap into the bond market.

Speaking at the Investment Management Association of Singapore Conference, Senior Minister of State Josephine Teo highlighted that the (SSB) will have two key differences to make them more attractive to retail investors.

The bonds will allow individual bond-holders to get their money back in any given month with no penalty, which means that they do not have to decide upfront how long they wish to invest.

Unlike bonds that pay the same coupon each year, the SSB will pay coupons that “step-up” or increase over time. As a result, the effective coupon rates are higher the longer the bonds are held.

The SSB will offer the higher returns of a long-term bond and give what investors call a “term premium”, while retaining the flexibility of a shorter-term deposit, and the safety of an instrument guaranteed by the Government.

“We hope that the Singapore Savings Bond programme will encourage individuals to save and invest to meet their long-term financial goals and retirement needs,” Teo stated.