Singapore Savings Bond (SSB) - 2.01% (Jan 2019)

SSB for Jan 2019 has gotten itself to the next level - Offering 2% for the first year!! 

It seem to be going higher and higher, making short term deposits further and further unattractive as compared to SSB!

Image taken from SSB's site - www.sgs.gov.sg

I've written briefly on several issues of SSB previously which you might wish to refer to for some of my thoughts:
Singapore Savings Bond (SSB) - 1.78% (July 2018) 
Singapore Savings Bond (SSB) - 1.68% (June 2018)
Singapore Savings Bond (SSB) - 1.65% (May 2018)
Singapore Savings Bond (SSB) - 1.55% (Feb 2018) 


As a recap, on my thoughts about the shiny part for the Singapore Saving Bonds:

1. The flexibility in your funds
2. A risk-free place for you to park your money with no capital loss
3. A relatively lower amount and attractive rates compared to FDs.  (In fact, SSB is offering a higher interest as compared to FD today)
4. Certainly a place for you to park your monies to avoid you from overspending (Upcoming post) 

Below is the interest rate table for the upcoming SSB Jan 2019:

One must always remember that despite the flexiblity of SSB, the fund here has to spare fund to you and that you can last for at least a month while waiting for proceeds from redemption.

Do take note that everyone's situation is different and unique. Actions should never be done because majority are doing so, but to consider upon your own situation before acting.

I've also recently shared with some of my peers on how they could utilize SSB as a form of forced savings to help them with saving up, which I will write more about it in the upcoming post. 

Personally, I will be grabbing up this edition of SSB. 

For more information on redemption, please check on from SSB's official website here.

Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 2 January 2019
Maturity Date: 1 January 2029
Interest Payment: 1st interest payment will be made on 1 Jul 2019, and subsequently every six months on 1 Jan and 1 Jul every year.

Application Period: 
Opens: 6.00pm, 3 December 2018
Closes: 9.00pm, 26 December 2018
Results: After 3.00pm, 27 December 2018






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Temasek T2023-S$ Bond

Temasek had recently launched a bond available for retail investor 2 days ago. The latest bond released by Temasek was the first ever that is opened for public to participate in. 

Here are the details below for an overview:

Interest Payment Date: 25 April / 25 October yearly.

For an easier explanation, I believe Temasek has done a nice job to include a short introduction and explanatory about the bond they're issuing to provide a the public with a general idea of the bond.

You may wish to take a look at the video below for more information

Investors must be reminded that the instrument they are looking at, today at is a bond. A bond is a fixed income instrument and by investing in bonds, we are essentially borrowing our monies out to the issuer, and in this case, Temasek Holdings. 

When we become money lender, we are paid coupons. In this case 2.7% annually, which will be paid twice across a year until maturity. Upon maturity, the principal amount will then be returned to the money lenders.

As bonds are a fixed income instrument, the interest rate for the bond is fixed throughout the 5 year. 

Meaning to say, should the interest rate in the economy rises more than what the bond could offer, your bond is essentially worth lesser as the same amount of money invested for this 2.7% can be invested for 4% interest. 

Making the other deal more attractive and to price it along, the unit price of your bond will fall. However, when the opposite happens, your bond will be worth much more. 

So yes, the general idea of bonds is there.

Taking yourself as a money lender today, the risk involving money lending will include the risk of your lender not repaying you. In this sense, we refer to the term as defaulting on payment. Hence, it is very important for the issuer to have credibility. 

Taking a look, Temasek Holdings hold a credit rating of AAA, rated by S&P and Moody. AAA represents the highest level of credit rating which has an exceptional degree of creditworthiness, perceived to have the smallest risk of default.  

As investors, we are most commonly paid for the risk we undertake in each investments. The higher return will command a greater level of risk involves and vice versa. For what we see today from Temasek, the risk of defaulting is minimal and having that said, we must expect a conservative return instead of crazy ones.

Comparing it to the SSB, we must also understand that there are differences between both product and this is the reason why we are paid slightly more in interest.




SSB despite being kept in our CDP accounts, they are not traded in the market whereas the T2023-S$ will be traded in the SGX market. Having that said, we will also be able to buy into the bonds from the open market after 26 October 2018. 

When traded on an open market, there will be a certain level of rationality by Mr Market and prices of the bond could be driven either ways by investors that buy and sell on the market. With that in mind, if we were to liquidate the bond somewhere in between the 1st-5th year and the price is down south, we will see ourselves selling them at a loss.



As this is a fixed income instrument, should the price of this bond fall below it's listed price of S$1, we will be looking at a higher interest received when we buy from the market afterwards. 

The bond application will close on 23/10/2018 12:00PM and will start trading on 26/10/2018 09:00AM on SGX market.

Successful applicant will be notified on 25/10/2018 and refunds of unsuccessful allocation will be paid of 24/10/2018 along with the announcements.

CPFIA-OA can also be utilized to participate in the bond issue of up to 35% and application of bonds can be done through iBanking, ATMS and Mobile banking app of POSB/DBS, OCBC and UOB.


As compared to some other products available, we must be reminded that this is a safer investment and will not be suitable for those who crave a greater returns. 




As it is traded in the open market and subjected to more risks, the T2023-S$ is also not a suitable place for us to park our emergency funds as our e-funds should not be subjected to losses when we liquidate it due to emergency. When we invest in T2023-S$ bond, it's best for us to hold through the 5 years period.

The T2023-S$ Temasek Bond should be regarded as a safer investment as opposed to the SSB, which we can view it more to a fixed deposit.

As usual, I believe it's very important for us as an investor, to know ourselves. Which equipment we use will depend on what objective we need and the purpose for doing so.




Reference:
- Temasek Bond T2023-$ (Product Highlights)
- Temasek Bond T2023-$ (Offering Circular)
- Temasek Bond T2023-$ (Pricing Supplement)


More details can also be found on Temasek's official website on T2023-S$ Bond


You will also be able to look for me on some other platforms:
1. FB Page - The sleepydevil
2. InvestingNote - sleepydevil
3. SGX Cafe - sleepydevil
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Singapore Savings Bond (SSB) - 1.78% (Aug 2018)

The interest rates offered by SSB has been getting more and more exciting months on month since the start of 2018, breaking a new high each time.

Image taken from SSB's site - www.sgs.gov.sg

I've written briefly on several issues of SSB previously which you might wish to refer to for some of my thoughts:
Singapore Savings Bond (SSB) - 1.68% (June 2018)
Singapore Savings Bond (SSB) - 1.65% (May 2018)
Singapore Savings Bond (SSB) - 1.55% (Feb 2018)

As a recap, on my thoughts about the shiny part for the Singapore Saving Bonds:

1. The flexibility in your funds
2. A risk-free place for you to park your money with no capital loss
3. A relatively lower amount and attractive rates compared to FDs.  (In fact, SSB is offering a higher interest as compared to FD today)

Below is the interest rate table for the upcoming SSB Aug 2018:

One must always remember that despite the flexiblity of SSB, the fund here has to spare fund to you and that you can last for at least a month while waiting for proceeds from redemption.

With an average return per year at 2.57% if one were to hold through the entire 10 years, it certainly look pretty decent as a "short-term" flexible option to CPF for one to has in their portfolio.

Do take note that everyone's situation is different and unique. Actions should never be done because majority are doing so, but to consider upon your own situation before acting.

Personally, I view the SSB as an instrument to keep my dollars tied away and to only act upon when there is a very shiny opportunity awaiting me. This action here also keeps away a certain fraction of the portfolio in cash position that is not exactly having the standard low interest provided by the banks.

I do not know when an opportunity like this might surfaces, but let's hope that it doesn't!
Or at the very least, I do know that at this very point, I do have $1,000 to act on. Haha!

For more information on redemption, please check on from SSB's official website here.

Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 1 August 2018
Maturity Date: 1 August 2028
Interest Payment: 1st interest payment will be made on 1 Feb 2019, and subsequently every six months on 1 Feb and 1 Aug every year.

Application Period: 
Opens: 6.00pm, 2 July 2018
Closes: 9.00pm, 26 July 2018
Results: After 3.00pm, 27 July 2018






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Singapore Savings Bond (SSB) - 1.68% (June 2018)

Now, this coming round of SSB in June 2018 is more interesting offering up to 1.68% interest for the first year!!

Image taken from SSB's site - www.sgs.gov.sg

I've previously blogged about 2 previous edition in May 2018 and Feb 2018, speaking about how attractive the interest look as compared to fixed deposit.



You may refer to the 2 articles below:
Singapore Savings Bond (SSB) - 1.65% (May 2018)
Singapore Savings Bond (SSB) - 1.55% (Feb 2018)

As a recap, on my thoughts about the shiny part for the Singapore Saving Bonds:

1. The flexibility in your funds
2. A risk-free place for you to park your money with no capital loss
3. A relatively lower amount required compared to FDs.  (In fact, SSB is offering a higher interest as compared to FD today)

Below is the interest rate table for the upcoming SSB June 2018:

Source: SSB

I've mentioned this in my earlier post on SSBs. But as a quick reminder to newer readers which might have missed out on that, one must bear in mind that it may seem really attractive for a risk-free bond to generate 1.68% on a short term of 1 year, only proceed on when this fund here is a spare fund to you and that you can last for at least a month while waiting for proceeds from redemption.



This is due to the waiting time in between your redemption of SSB for which the redemption of SSB will be only be closed on the last 4th business day of the month and proceeds will only be paid on the 2nd business day of the following month.

For more information on redemption, please check on from SSB's official website here.

Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 1 June 2018
Maturity Date: 1 June 2028
Interest Payment: 1st interest payment will be made on 1 Dec 2018, and subsequently every six months on 1 Jun and 1 Dec every year.

Application Period: 
Opens: 6.00pm, 2 May 2018
Closes: 9.00pm, 25 May 2018
Results: After 3.00pm, 28 May 2018

Similarly to the previous months, I will be looking to allocate my opportunity funds into the upcoming SSB edition.




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SSB (May 2018) Subscribed by 2.6 times

(EDITED 28/04/2018: SSB (May 2018) Subscribed by 2.6 times, instead of oversubscribed by 260%. I'm terribly sorry for any unintended confusion caused and kindly pardon me for the mistake.)

Today is the day MAS releases the result of the SSB allotment for May 2018 SSB.

MAS has raised the issuance size from S$150 million to S$200 million earlier this month, in response to the higher demand for SSB.

The first time SSB is oversubscribed is during the 1.55% January 2018 SSB issue, which it was briefly oversubscribed by S$22 million. This was the best interest offered by SSB till this month's tranche.

The second time happened last month when it was oversubscribed by S$111 million, which is when MAS decided to increase the issuance size to S$200 million.

Now, today, for May 2018's SSB issue, it is oversubscribed by S$321 million or 160%!!


Take a look!

Source: SSB

Seems like finally, SSB is getting some support from the public!

Indeed, I felt that the interest rates offered by May's tranche are really attractive at 1.65% for the first year and 2.39% average return per year if you plan to hold it for the full 10 years.

For applicants that applied for SGD 13,000 or lower, congratulations. You're fully allotted.
Those who applied for more than SGD 13,500 were allotted either SGD 13,000 or 13,500 randomly.

Meaning to say, the most one can get from this tranche is SGD 13,500. For those who applied for more than SGD 13,500, you may wish to take a look at your bank account to check for the refunds posted.

Source: SSB - May 2018 Issue Interest Rate

Similar to January's issue, I've gotten myself $500 worth of SSB for May 2018's tranche using the funds in my opportunity funds.

Regular readers would remember what my 'opportunity funds' here is for.


To those newer readers, here's a small recap of my post back in December 2017:

The 19-Year-Old Year Review, Reflection & 2018 Resolution

As my 'additional war chest' that I've included in my portfolio updates only has $850.00, I've decided to only subscribe for $500, leaving $350 in that account.

It would be really strange, why did I not top up another $150 to make it a thousand instead, as such 'guaranteed' high rates do not come by so frequently in SSB!


Silly me!

$500 in May 2018's SSB will mean that I will be receiving $4.12 in November and another $4.12 in May 2019.

This will also mean that I'm getting 2 free Fillet-O-Fish burger every half a year! Ala-carte burger only. No meal this time round!

On a side note, I'm really glad that I finally manage to convince my mother into applying for some SSB this month, instead of the 0.05% interest POSB account that she is holding onto.

As an extremely risk adverse person, probably it's time that her money will start working a little harder for her.

I will continue to look out for the upcoming SSB for further opportunities to park my opportunity funds. Remember. Opportunity funds!

Read: Singapore Saving Bonds (SSB) - 1.65% (May 2018)

Link to MAS's announcement can be found here.

You may also subscribe to receive my latest email updates here. 

Singapore Savings Bond (SSB) - 1.65% (May 2018)

This time round. It's more attractive!

The SSB issue for May 2018 offers a 1.65% interest for the first year! Stretching up to 3.00% for the 10th year. Aside this, the SSB monthly issurance size has also increased from the usual 150 million to 200 million due to increasing demand for SSB!

Image taken from SSB's site - www.sgs.gov.sg

Seems like SSB is getting some popularity in recent days!



As usual, I've been looking around for a good place to park some funds for a short term. Today's release of SSB for May 2018 has come to me as a surprise.

The rates we see here today is even better than rates offered by fixed deposits from banks that I know off (in SGD for 12 months)!

I've mentioned earlier in a post back in January about the shiny part I like for the SSB issued in Feb 2018:

1. The flexibility in your funds
2. A risk-free place for you to park your money with no capital loss
3. A relatively lower amount required compared to FDs.  

If the rates offered by SSB is lower than what we can get from fixed deposits, why SSB then? 
As a consumer, I must find product that caters well to my needs/wants.
 
I do not want my funds to be rotting and the interest here from fixed deposit or SSB today will save me a little on the opportunity cost.

I want the funds here to be easily liquidated. SSB can be liquidated at any given month before the bond matures with no penalty. Interest is pro-rated too (more information here). On a side note, the only charges will be $2 for redemption and $2 for application.

I want some assurance on these funds too so I can sleep in peace knowing that my opportunity funds will not lose its value or evaporate. This will allow me to better make use of bargains in the future.



Too good to be true? But never buy blindly!

One must bear in mind that it may seem really attractive for a risk-free bond to generate 1.65% on a short term of 1 year, only proceed on when this fund here is a spare fund to you and that you can last for at least a month while waiting for proceeds from redemption.

Do note that for redemption of SSB, it will require a little bit of time as well.
Redemption of SSB will be closed on the last 4th business day of the month and proceeds will only be paid on the 2nd business day of the following month.

For more information on redemption, please check on from SSB's official website here.

Interest Rates for May 2018's SSB (for GX18050E):

Source: SSB

Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 1 May 2018
Maturity Date: 1 May 2028
Interest Payment: 1st interest payment date on 1 Nov 2018 and subsequently every 6 months on 1 May and 1 Nov every year.

Application Period: 
Opens: 6:00 pm, 2 Apr 2018
Closes: 9:00pm, 25 Apr 2018
Results: After 3:00pm, 26 Apr 2018


For more information, please visit SSB's website on the latest bonds here.

I will be applying for some SSB in May 2018's edition to park my funds.

You may also subscribe to receive my latest email updates here.

Read: 
Singapore Saving Bonds (SSB) - 1.55% (Feb 2018) 

Portfolio Update - Divestment of FCOT & SSB Allotment

It had been sometime since anything have happened to my equities portfolio.

Having that said, it's truly a pity that I have to write this today. In my first portfolio update of 2018, instead of the regular 'buy', it had turned into my first 'sell' transaction. I've divested 300 shares of FCOT at 1.46 today after it went into XD. 

Taking into the account of all the transaction fees, this divestment at 1.46 translates to a P/L of 8.29% or S$33.10 (without dividends) and 15.66% or S$62.53 (with dividends). This big increase you see here is due to the relatively small amount that I've placed into the investment. Nonetheless, this also serves as a good lesson learnt along the way.

FCOT announced it's 1Q18 results and had declared a 2.40 cents distribution for the period. Shares of FCOT had since went XD. With it's recent run, and at today's price of 1.46, the current price  translates to 94% of FCOT's book value at 1.55. Surely, it is still trading a small discount to it's NAV, however the sightings of several signs in the financial report had got me shaking my head.

FCOT's 1Q18 Financial Highlights

There have been a lower occupancy rates at ATP given the departure of HP and along with the weaker AUD, it had resulted in a 11% down in gross revenue year on year. NPI had also decreased significantly by 15% due to the given factors and DPU had shrink by 4%.

Fortunately enough that FCOT's management fees are paid in units rather than cash. Should FCOT's management decide to receive cash instead of units, the DPU will be badly bruised. With 2.40 cents in mind, this translates to an annualized dividend of 6.5% based on the latest price of 1.46, which is no longer attractive.

However, if it is based on my entry price at 1.295 earlier last year, the DPU is neither too attractive either at 7.4%. Considering if the DPU continues to fall, or the management deciding to take cash as management fees, the yield will be far less attractive. Revenues should be able to well recover when more areas in ATP are leased out.

With HPS leases expiring, and should they leave ATP, this event will vacated roughly 16.7% of ATP's NLA. With that in mind, the distribution will once again be impacted negatively.

On a side note, they have also went into the acquisition of 50% in Farnborough Business Park, UK. This deal is set at £175 million. A rough calculation based on the latest exchange rates (1-1.84) will mean that FCOT is acquiring this FBP at S$161.22 million.

Page 9 of 1Q18 Financial Statement

A quick look into their financial statement at the end of 31 December 2017, it shows that FCOT does not seem to have sufficient cash for the purchase which is said to be completed by end-January. This makes me wonder on how this acquisition will goes about. 

With a decent gearing at 34.8%, FCOT is able to take up loans easily for the acquisition. However with that in mind, the gearing will no longer be attractive anymore. Or perhaps, a rights issue might be coming?

Today, FCOT continues to have a relatively decent gearing at 34.8% while prices today, despite FCOT trading at a 5% discount to NAV, tells me that FCOT is no longer undervalued. With the uncertainties ahead and considerations, I decided to divest my shares of FCOT.

Assuming that HPS vacates from the premises, based on a simple envelope-back calculation of HP's total GRI of 11%. Stripping that off will impact it's DPU to shrink to 8.54 cents, which translates to a DPU yield of 5.85% based on today's price of 1.46.
This yield today at 5.85% is no longer attractive for FCOT considering the uncertainties ahead such as increased gearing, rights issue or even the vacating of other tenants and is also unable to compensate the risk for this investment.

As I've divested on XD, I will still be receiving $7.39 of dividends from FCOT on 1 March. As to the 8 balance script shares that I've subscribed previously, I guess, that shall be considered my 'legacy' positions in FCOT? Haha! Nonetheless, FCOT will be officially removed in my coming portfolio update.

FCOT's results presentation here.
FCOT's financial statement here.

On a side note, I've been successfully allocated with S$500 worth on SSB from the previous SSB exercise. (GX18020A). The SSB had been oversubscribed by S$172 million. Applicants who applied for $41,500 or higher would receive $41,000 or $41,500 based on the latest news from MAS.

Guess, for small birdies like me, nothing much. However, as mentioned earlier in my previous post, the purchase of SSB serves as a form of diversification as well as personally, I view that SSB is a really attractive and good platform for me to park my money in.

News on SSB oversubscribed can be found here.

Read: Singapore Saving Bonds (SSB) - 1.55%

Singapore Savings Bond (SSB) - 1.55% (Feb 2018)

I've been reading about bonds for sometime and in one of my previous post, I've mentioned that I will be establishing a separate new war-chest in my last portfolio update in an attempt to build up a sizable cash position. There is some balancing work that I have been doing this month and utilizing a small portion of the cash, I've decided to take up the SSB that is issued this month.

As the cash that is sitting in the warchest are waiting to be deployed, placing them into the SSB allows me to get a higher interest than from the bank. Also, I take the SSB as a form of mini-diversification as well as an avenue to temporarily park my money before the funds here are being deployed.

In a brief summary, the SSB is suitable for you IF:
1. You have limited funds/insufficient funds for a FD.
2. Require flexibility in your funds
3. Looking for a safe place to park your money where you will have no capital loss

Hence, considering the factors, the SSB fits quite well into my criteria (especially point 1). Yes indeed, there are bank accounts that are offering really attractive interest like the UOB One, OCBC 360, CIMB FastSaver and even to the latest DBS Multiplier Account etc. However, these accounts comes with certain conditions to fulfill and unfortunately as a student, I'm not able to fulfill the most basic criteria, which is to have salary credited into that account. Thus explaining more onto why I'm looking to the SSB.

In time soon, when I'm conscripted, I would have another option available - POSB SAYE Account which is offering up to 2.25% interest. The POSB SAYE account is an account that catered towards the males which are serving the National Service. With your NS allowance credited into your savings account that is linked to POSB SAYE, and contributing to this POSB SAYE account, you will be eligible to the 2.25% interest. Nonetheless, as time are nearing, I will be writing more about this account.

Back to the SSB account, the interest offered is different every month. You may wish to refer to this website (link), to check out on their latest bond and the interest.

Here's the latest interest rate (for this month's bond: GX18020A)

You may also wish to refer to this link to find the historical rates for SSB here.

1.55% interest for the first year is indeed pretty attractive, tho any investment will probably be able to beat them in terms of dividend yield. However, the true shiny point is the risk-free and liquidity you can receive from them.

Hence, for now, with the above mentioned point, I've applied for the latest bond. I will also be writing more about it upon the result release.

Should you wish to hold longer, you will be able to receive a higher interest payment along the year with up to 2.75% upon maturity at the 10th year.


Here are some important dates for this bond for anyone who's interested to consider:
Issue Date: 1 Feb 2018
Maturity Date: 1 Feb 2028
Interest Payment: 1st interest payment date on 1 Aug 2018 and subsequently every 6 months on 1 Feb and 1 Aug every year.

Application Period: 
Opens: 6:00 pm, 2 Jan 2018
Closes: 9:00pm, 26 Jan 2018
Results: After 3:00pm, 29 Jan 2018

Image from SSB's site: www.sgs.gov.sg

What is Singapore Saving Bonds?
Singapore Saving Bond (SSB) is a saving bond that is backed by the Singapore Government. The insurer here you're looking at is the Singapore Government, whom received the strongest credit rating of 'AAA' from the international credit agencies.

The minimum amount for the SSB starts at S$500.00 with a ceiling of S$50,000 per bond (Investment sum in multiple of S$500.00). You're also subjected to the maximum individual holding of SSB at S$100,000.

You'll be eligible to invest in the SSB so long you're 18 year old and above.

The really shiny point and thing that I like about SSB is the ability to get back your capital fully without capital losses along with the relatively small amount that you can put in, rather than the usual fixed deposit where you will need amount like S$20,000 and such. Aside this, you'd also be able to retrieve your capital at any month with no penalties.

Interest for the SSB will be paid every 6 months. At the start of each month, there will be a new saving bond issued each month. The maturity for which your SSB is up to 10 year. 


Right before buying the SSB, do ensure that you have a couple of things with you. 
- A bank account with POSB/DBS, OCBC or UOB.
- Individual CDP Account linked to any of your bank account through Direct Crediting Service (DCS)

So how can you start buying the SSB?
Apply through ATM/iBanking. Be sure to have your CDP account number with you when you're applying and there will be a transaction fee of S$2. Money will be directly deducted from your bank account upon buying the SSB.

The portal for application will open on 6pm from the 1st business day to 9pm on the 4th business day of each month and you might wish to refer to the calendar (here) for the dates.

Upon successful application, your SSB will be deposited into your CDP account and there will be a mail from CDP to inform you of successful allotment.

For more information, please visit SSB's website here.