Corporate bonds

[wondrdoggie]

Not true. Dont ever buy any bond from your RM. All bonds can be bought via your brokerage at a better price.

I can buy new issue 250k otc bonds at par price from my brokerage.
I can buy otc 250k bond via secondary market at 0.2%-0.18% coms via my brokerage.
You can never get these kind of rates at DBS treasures.

Also I prefer my bonds to go into my cdp rather than into a bank custodian because it will expose you to additional business risk for the latter.

Hi, I have never bought bonds from dbs treasures before so I can't comment on their prices. But from the private banks, the most I have ever paid was 100.25 for new issues and that was OUB. I realized I totally overpaid when I started using other private banks. So now, for new issue I usually pay par though there has been a few times where I actually got below par around 99.8. I asked them how come can give me par, how they make money? They told the bank gets a discount from par so they could pass on some savings to clients.

 

[wondrdoggie]

wondrdoggie comes across as someone who isn't that particular about paying her RM as long as it's profitable so I suppose you are preaching to the wrong person. I realise she doesn't scrutinize price that much or at least I assumed so. Her expertise lies somewhere else, e.g. investing in start-up.

No offense intended, just an observation. May not be true.
And yes, thank wondrdoggie for always willing to share.

Well, I do care about cost and prices, just that I accept a trade off when I don't want to spend too much time or effort. It's also a lot of self awareness over time, I am good enough to understand the basics plus some, I don't have the discipline or patience to do a very good job. So I pay others to do it.

And definitely no offense taken. I also don't know why these forums are so flammable sometimes. A lot of egos at play I guess. Anyway, I believe in treating people with politeness and respect online or offline. Some people are quite idiotic though. Haha

 

[Keverus]

private banks of cos better lei haha.

dbs treasures not yet private ma, unless you are under treasures private client. even then, i dont think you're really consider private banking yet.

private banking need 5 mil rite?

i heard frm someone, rates at private banking level is really good. guess the rich gets richer...

 

[wondrdoggie]

wondrdoggie, thanks for all your sharing.

just curious, olam bonds should be fine isnt it? thght temasek white knighted them?

Yes but I panicked and sold at around 88. I was inexperienced and dumb. But at least I limited my losses. Now my swiber bond matures in 2016, don't know if they will default. They redeemed the 2015 one recently but they don't have enough cash for the 2016 trenches. They need to raise money somehow. Bonds issue is out of the question I think, so need to see if any banks would prop them up or some structured deal with a white knight.

 

[Keverus]

Yes but I panicked and sold at around 88. I was inexperienced and dumb. But at least I limited my losses. Now my swiber bond matures in 2016, don't know if they will default. They redeemed the 2015 one recently but they don't have enough cash for the 2016 trenches. They need to raise money somehow. Bonds issue is out of the question I think, so need to see if any banks would prop them up or some structured deal with a white knight.

wa, 12% loss on a bond...painful.

as for swiber, i think it gonna be a rocky ride..

 

[Majestic12]

U say if get physical u worry for him. Thats good and very confident words. But if u really not scared why u didnt dare to meet him? And instead try to stab people online ?

Why waste my time on jokers like you?

 

[Majestic12]

Yes but I panicked and sold at around 88. I was inexperienced and dumb. But at least I limited my losses. Now my swiber bond matures in 2016, don't know if they will default. They redeemed the 2015 one recently but they don't have enough cash for the 2016 trenches. They need to raise money somehow. Bonds issue is out of the question I think, so need to see if any banks would prop them up or some structured deal with a white knight.

Likely some form of debt restructuring for creditors.

The banks were incredibly glad to offload them from their own books when Swiber's bonds were issued in the years leading up to now.

 

[wondrdoggie]

private banks of cos better lei haha.

dbs treasures not yet private ma, unless you are under treasures private client. even then, i dont think you're really consider private banking yet.

private banking need 5 mil rite?

i heard frm someone, rates at private banking level is really good. guess the rich gets richer...

Treasures private client is 2-5m
Private bank is 5m and up

But I know they can be flexible.. They will allow lesser amts if you can show you have the potential to add more. Other PBs are like that too. Plus if you came as a referral from another client, also easier to get in with less.

Banks are just like other businesses, you give the best prices for your best clients. You give better prices for those that buy more. Same same.

 

[Sai777]

swiber is in my watchlist too.

They called 062015 and they were talking about calling 9.75 092015 perpetual bond which is about $95m; otherwise coupon will raise by about 3%; which is a huge increase in financial cost. However, if the bid/ask is around 80, there is less incentive to call.

For 072016, it is about 12 months to maturity. Market speculation is that the bank is to restructure the debt and maybe even issue another high yield bond.

 

[neanea]

How do you choose which bond to buy?

 

[Sai777]

I choose based on their ability to service their debt.

 

[neanea]

I choose based on their ability to service their debt.

Which bank are you with?

 

[Sai777]

UOB and SCB

 

[neanea]

UOB and SCB

Buy Through rm or through broker?

 

[wondrdoggie]

swiber is in my watchlist too.

They called 062015 and they were talking about calling 9.75 092015 perpetual bond which is about $95m; otherwise coupon will raise by about 3%; which is a huge increase in financial cost. However, if the bid/ask is around 80, there is less incentive to call.

For 072016, it is about 12 months to maturity. Market speculation is that the bank is to restructure the debt and maybe even issue another high yield bond.

Last I checked 2 months ago, there was no liquidity at all for the 7/2016 bonds. A couple of fake bids but when contacted was a no deal. There was a real bid at around 50 from an obvious bottom feeder though. I decided to just wait it out. I heard DBS sold a ton of these bonds to their clients. Did you check recently what the bids are like?

My bankers were doubtful they could issue another bond though. But from what I remember, they had quite a lot AR on their books, so hopefully the oil prices stablizes and their customers start paying up. Still, the 2016 trenches are pretty large.. I hope they work out a deal to restructure. If not, it's a painful lesson man!

 

[Sai777]

Last I checked 2 months ago, there was no liquidity at all for the 7/2016 bonds. A couple of fake bids but when contacted was a no deal. There was a real bid at around 50 from an obvious bottom feeder though. I decided to just wait it out. I heard DBS sold a ton of these bonds to their clients. Did you check recently what the bids are like?

My bankers were doubtful they could issue another bond though. But from what I remember, they had quite a lot AR on their books, so hopefully the oil prices stablizes and their customers start paying up. Still, the 2016 trenches are pretty large.. I hope they work out a deal to restructure. If not, it's a painful lesson man!

My guess about liquidity is that 072016 is only 75m, only a handful of lots in the market. They have 3 series to call in 2016. The one before 072016 is 062016 and it is 130m. The closest bid I found is 042017@74.3.

Current AR is almost 665m which is a good sign. This may help them fullfil their short term debt obligation. However with their popiah thin margin, it is hard to survive with current operation. They have to do something to get money to repay the rest.

Your banker must have also given you words of comfort that so far we dun have local corp default bond. Hope that it sails well for you.

 

[wondrdoggie]

My guess about liquidity is that 072016 is only 75m, only a handful of lots in the market. They have 3 series to call in 2016. The one before 072016 is 062016 and it is 130m. The closest bid I found is 042017@74.3.

Current AR is almost 665m which is a good sign. This may help them fullfil their short term debt obligation. However with their popiah thin margin, it is hard to survive with current operation. They have to do something to get money to repay the rest.

Your banker must have also given you words of comfort that so far we dun have local corp default bond. Hope that it sails well for you.

My bankers had no words of comfort for me. They pointed to swiber when I transferred all my bonds from UOB and said "cannot have too many of these type, one is enough".

That's also one of the reasons I am no longer active with UOB, I didn't feel they gave me good advices.

 

[SpeedingBullet]

My bankers had no words of comfort for me. They pointed to swiber when I transferred all my bonds from UOB and said "cannot have too many of these type, one is enough".

That's also one of the reasons I am no longer active with UOB, I didn't feel they gave me good advices.

Can you get oversea bond placements as well? I'm not talking like those super hot American bond issues (Apple, Exxon, etc.) but like midcaps? Will you get the same spreads or way more exorbitant?

 

[MilleniumX]

Sorry, this may be a dumb question, but can we get leverage if we buy via broker?

And a noob question, buying via broker means someone like Kim Eng (i.e. non bank platform)?

 

[neanea]

How do we know when there is a new bond offering?