Manulife Taps Asia Debt Market for 1st Time With Singapore Sale

  • Canadian insurer issues S$500 million of subordinated debt
  • Operations in city-state among company’s fastest growing

Manulife Financial Corp. is tapping the Asian capital markets for the first time as it seeks to broaden its funding sources and investor base.

Canada’s largest life insurer issued S$500 million ($365 million) of subordinated debt in Singapore with a 3.85 percent coupon due in 2026, the company said in a statement. The notes have a fixed rate until May 25, 2021, when they will convert to rate of 1.97 percent over the prevailing five-year Singapore dollar swap rate. The notes are callable after May 25, 2021.

S&P Global Ratings assigned an A- rating to the debt.

"This issuance marks our first debt transaction in Asian capital markets, and further supports our branding and banking partnerships in the region," Chief Financial Officer Steve Roder said in the statement. "This transaction is an important part of our global strategy to diversify funding sources and to broaden our investor base."

The offering marks Manulife’s latest foray into Singapore, one of its fastest growing operations, according to the company. It recently announced it is seeking up to $470 million in a second attempt at a initial public offering of its U.S. properties in the Southeast Asian city-state.

DBS Bank Ltd. and Standard Chartered Plc have been appointed as joint lead managers, and Australia & New Zealand Banking Group Ltd. is a co-manager of the bond offering. Proceeds from the deal, expected to close May 25, will be used for general corporate purposes, the company said.

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