Coming Soon: A Retail Bond across the Straits of Tebrau

Retail bonds may soon become a reality for Malaysia investors.

CapitaMalls Asia Ltd, through its wholly-owned unit, CapitaMalls Asia Treasury Ltd (the issuer) has announced a public offer for the first retail bond in 2012, catering to investors looking for fixed income returns and capital protection. The public offer will start on Jan 4 and close on Jan 9, 2012. It will list on the main board of Singapore Exchange Securities Trading Ltd (SGX-ST).
An application under the public offer is subject to a minimum of S$2,000, with incremental multiples of S$1,000. Very “affordable” indeed!

Coming Soon: A Retail Bond across the Straits of Tebrau by CF Lieu - Certified Financial Planner MalaysiaImage Source

The public offer would enable individuals to partake in the rental income resilience of CapitaMalls Asia’s portfolio of shopping malls. Interest payment is 3.8 per cent per annum for year one to five and 4.5 per cent per annum for year six to 10, if the bonds are not redeemed early at the option of the issuer. CapitaMalls Asia Ltd is one of the largest listed shopping mall developers, owners and managers in Asia by total property value of assets and geographic reach. It has interests in and manages a pan-Asian portfolio of 97 shopping malls across 51 cities in the five countries of Singapore, China, Malaysia, Japan and India, with a total property value of approximately S$26.9 billion and a total gross floor area of approximately 88 million sq ft.

Read why I am invested in Capital Malls Malaysia Trust, a shopping mall REIT and what is bond.

Meanwhile, a link among Singapore Stock Exchange (SGX) and Bursa Malaysia will be up by June this year. This will make trading easier for average Joe investors venturing into SGX, especially those looking for paper asset diversification in bonds. Currently, bonds are sold in RM 5 million denominations in Malaysia. Bond funds and bond ETF are the only avenues for investors like you and me to invest in bonds.


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