Amadeusz Juskowiak

Trading delayed on singapores new bill market

The start of trading on the new Singapore Government Securities Market has been postponed until late March or early April because legislative amendments still need parliamentary approval banking sources said

The new bill market intended to establish a base for a wider capital market and to encourage private bond issues in Singapore was supposed to be launched today

William KK Wong managing director of Indosuez Asia Singapore Ltd said there is no real obstacle to prevent the new market from taking off Most dealers are optimistic it will provide more liquidity for operators to trade he said

Lawrence Yeo director of Citicorp Investment Bank Singapore Ltd said the markets success depends on domestic participation

The five primary dealers and the three registered dealers will all be local companies

The primary dealers are Commercial Discount Co Ltd National Discount Co Ltd OverseaChinese Banking Corp Ltd OCBMSI Overseas Union Bank Ltd and United Overseas Bank Ltd UOBMSI They will underwrite the Monetary Authority of Singapore MAS auctions maintain market liquidity and channel openmarket operations MAS said

Citicorp Investment Bank Singapore Ltd Indosuez Asia Singapore Ltd and Credit Suisse First Boston Asia Ltd will be recognised as registered dealers They will act as market makers but will not bid directly at auctions

MAS plans to launch trading by issuing taxable instruments grossing seven billion dlrs in the first year and a gross 38 billion dlrs of paper over the first five years

Noncompetitive bids from primary dealers prepared to accept average yield will be allocated first to a maximum 500000 dlrs for notes and bonds and to an unlimited amount for treasury bills

The remaining amount will be awarded to competitive bidders from the lowest yield upwards

In the secondary market the standard lot traded between dealers will be one mln dlrs worth of treasury bills and 500000 dlrs worth of government notes and bonds