OCBC prices $1b perpetual capital securities at 4%

They will be issued by 24 August and will be first callable in 2023.

OCBC Bank priced its $1b perpetual capital securities at 4% and will be first callable in 2023 under its US$30b Global Medium Term Note Program. Net proceeds from the issue of the capital securities shall be used for the general corporate purposes of OCBC Bank.

The bank explained that the capital securities are meant to qualify as Additional Tier 1 capital of the bank based on the requirements of the Monetary Authority of Singapore (MAS).

Subject to MAS approval, the capital securities may be redeemed at the option of the bank on 24 August 2023 which is its first reset date. It may also be redeemed on any distribution payment date falling after the said date upon the occurrence of a tax event or if the capital securities would no longer qualify as eligible capital.

Moreover, the terms of the capital securities may also be varied depending on approval from MAS in order for the capital securities to remain as Additional Tier 1 capital of the OCBC.

Credit Suisse (Singapore) Limited, OCBC Bank and Standard Chartered Bank will manage the issuance of said securities starting 24 August.

Moody's Investors Service has assigned a Baa1 rating to the capital securities.