UOB has priced A$1 billion (S$858.1 million) in four-year senior unsecured notes due 2028 under its US$30 billion global medium-term note programme.
The notes were priced on Friday (Aug 2) at the three-month Bank Bill Swap Rate (BBSW) plus 0.74 per cent. The BBSW is a short-term interest rate commonly used as a benchmark to price Australian securities and derivatives.
This marks the largest conventional Australian dollar single-tranche senior bond from a Singaporean issuer. The bank also said this is the tightest spread for a benchmark sized four-year Australian dollar transaction from an Asian bank.
The notes are expected to be issued on Aug 8.
This is the second time the bank is tapping the Australian dollar market this year. In April, it issued about A$1.3 billion in dual-tranche three-year unsecured notes.
Koh Chin Chin, UOB’s head of group treasury, research and customer advocacy, said: “The Australian dollar market is integral to our funding strategy. This year, in fact, it has been our largest pool of international benchmark capital.”
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The announcement comes after the bank released its earnings results last Thursday.
“This provided a first-mover advantage in light of more anticipated supply – more issuers globally are expected to tap the Australian dollar senior market amidst peak redemptions in August,” the bank noted.
Its second-quarter net profit rose due to double-digit fee income growth and lower credit allowances. Net profit for the three months ended Jun 30, 2024, stood at S$1.43 billion, a 1 per cent increase from S$1.42 billion the previous year.
Shares of UOB traded 5.4 per cent or S$1.72 lower at S$30.11, as at 1.09 pm on Monday.
