Singapore's Oversea-Chinese Banking Corp said on Friday it has sold 600 million ringgit ($184 million) worth of tier 2 bonds in Malaysia. The lower tier 2 subordinated bonds have a 10-year maturity with a call option and coupon step-up after the fifth year.
The bonds will bear a fixed interest rate of 4.6 percent per annum. If the bonds are not redeemed on the step-up date, the coupon will be increased to a fixed rate of 5.6 percent per annum. In March, OCBC, Singapore's third largest lender, said it had issued 1 billion ringgit ($315 million) of subordinated bonds to augment its capital, lower than it had intended to offer.
Asian issuers have been tapping the Malaysian bond market for lower cost funding as the global credit crisis raises the price of borrowing in dollars. OCBC had a Tier 1 capital ratio of 11.5 percent and total capital adequacy ratio of 12.4 percent as of December 31.
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