HSBC and Marketnode complete digital bond issuance in Singapore

HSBC acted as the arranger bank, custodian and settlement bank for the digital bond issued on the Marketnode platform.

By Joe Parsons

HSBC and Marketnode, the joint venture between the Singapore Exchange (SGX) and sovereign wealth fund Temasek, have completed a digital bond issuance, marking the latest milestone for the city state’s digital asset programme.

The digital bond was completed in conjunction with a S$1 billion perpetual securities issue by Singtel Group.

On the Marketnode platform, HSBC acted as the arranger bank, custodian and settlement bank, while also acting as the joint lead manager and bookrunner for Singtel’s perpetual securities issuance.

“This is a tangible step towards transforming capital markets infrastructure. The transaction demonstrates how digital assets can now be applied on a scalable and sustained level, across different bond structures and to service a wide range of investors,” said Gavin Powell, head of global markets, HSBC Singapore

“We are excited to continue on this journey with Temasek and our exchange partner of choice SGX, and with our clients to enable faster, more transparent, and fully secure settlements for bond issuers and investors.”

The digital bond issuance is the first transaction since the announcement of the joint venture in January 2021 and is the seventh issuance on its platform since August 2020 when SGX completed Asia’s first public syndicated digital bond.

“Digitalisation is part and parcel of Singtel’s operations and we are pleased to support SGX’s digital asset issuance, depository and servicing platform. This pilot digital issuance shows the potential to make the issuance process faster and more transparent for our investors and for us as an issuer,” added Arthur Lang, group chief financial officer, Singtel.

Singapore has been at the forefront of piloting digital asset transactions, with custody banks including BNP Paribas Securities Services, Deutsche Bank, HSBC and Northern Trust acting as key partners for these projects.

In January, Deutsche Bank’s securities services business revealed it is working with a Singapore-based Hashstacs Pte to develop a proof-of-concept (PoC) solution for digital assets. A month later, the FinTech firm then announced a partnership with BNP Paribas and Eastspring Investments for a new blockchain-based solution for the exchange-traded derivatives market.

Last year, Northern Trust and Singapore-based FinTech firm BondEvalue also completed the first trade of a fractionalised blockchain-based digital bond.