StanChart to issue Tk 850cr zero coupon bond
Standard Chartered Bangladesh has received regulatory approvals as the first bank to issue a Tk 850 crore zero-coupon bond in the country.
It is a non-convertible, unsecured, fully redeemable, zero coupon bond, the bank said in a statement.
The maturity period for the product will be five years from the date of issue. Green Delta Insurance Company will act as the trustee for this issue.
It marks another pioneering transaction for the British multinational lender in Bangladesh and is an important milestone in the development of the country's debt capital market, according to the bank.
"As the only multinational universal bank in Bangladesh, we are in a unique position of channelling capital where it matters the most," said Naser Ezaz Bijoy, CEO of Standard Chartered Bangladesh.
"As a trusted and reliable issuer with a 'AAA' credit rating for over a decade, we believe our offering will support the development of Bangladesh's capital market on one hand, while offering depositors a new avenue to invest in a product that offers attractive tax-adjusted returns."
"I am grateful to our regulators, Bangladesh Securities and Exchange Commission (BSEC) and Bangladesh Bank, especially Prof Shibli Rubayat-Ul-Islam, chairman of BSEC, and his team for supporting us in completing this pioneering transaction and their commitment towards the development of the bond market."
The zero-coupon bond will open up alternate investment avenues for corporates and individuals.
With this offering, the bank is leveraging strong investor confidence in its strategy and outlook, and the quality of its financial position, to increase its liquidity.
"The BSEC, in collaboration with our ecosystem of regulators and stakeholders, is working towards the development of Bangladesh's capital markets, particularly debt market, which will be vital for financing long-term needs of our industries and infrastructure," said Prof Islam.
"We hope Standard Chartered's issue will encourage greater participation of our leading corporates, state-owned enterprises, municipalities in the debt capital, devising optimal financing strategies which will help them grow and prosper sustainably."
Standard Chartered's initiative of issuing its first corporate bond is commendable and will contribute towards setting the right direction for capital markets, he said.
Standard Chartered is leading the debt capital market in Bangladesh as well as an acknowledged global leader in Asia, Africa and Middle East.
Since pioneering in 1997, the capital markets unit of Standard Chartered has arranged over $7.50 billion equivalent local and foreign currency in power, telecom, infrastructure, food and beverage, textile, service, renewable energy and other key sectors.
The bank operates one of the country's most sophisticated dealing rooms with a diverse range of risk management products, pioneering a number of financial firsts – including FX option in 2006, commodity derivative in 2008, interest rate derivative in 2009, and zero coupon Islamic certificate issuance in 2019.