What is Astrea 7 Bond?
The Astrea 7 bonds are being backed by the PE assets which mean investors will get a coupon as payment if they invest in these bonds. The common public can get Class A-1 bonds that total an amount of $280 million alongside Class B bonds that total worth the US $100 million.
For the Class 1-A bonds, the fixed interest rates are 4.125% per annum and Class B bonds have an interest rate of 6%. The bonds have an underlining exposure to the Asian, US, and European markets.
You can apply via ATMs of DBS Bank, OCBC Bank, and UOB Bank. You can also do it online through the websites of all three banks.
How to apply for Astrea 7 bond application?
To do an online application for the Astrea 7 bond, you must go to one of the three bank sites.
- From these bank sites, go to the Astrea 7 bond application.
- Fill in all the essential details like personal, educational, and financial details.
- Once you have filled in all the information, go ahead and click on the Submit button.
What are Application Requirements?
To buy Astrea 7 Bonds you must fulfill these Application requirements;
- Astrea 7 bonds are subject to market risks and if you are ready to take the risk you can apply.
- You must be 18 years or older to be eligible for the bond.
- Submit your identification papers as required.
- You must include the names of nominees for the bond.
Applicants can apply for these bonds from 9:00 am Friday on 20th May to Wednesday, 25th May.
Astrea 7 Bond Complete Details
The different bonds provided by Astrea are open to the public for 6 days. If you are interested in providing your application form for these bonds, you must put them forth during this span. Astrea offers Class A-1, A-2, and B classes of bonds.
Each of these bonds is being given for 4.735% (Class A-1), 5.625% (Class A-2), and 6.375% for Class B bonds. However, even though these are the interest rates, still the final price of the bond will be lower than the quoted price.
The Class A bonds are for 5 years with maturity in 10 years and Class B bonds are for a call span of 6 years and a legal maturity after 10 years.
The transaction structures of the bonds have undergone vigorous stress testing and can tolerate weak fund performances and difficult market conditions. However, like other bonds, these too are subject to market risks. Thus, before investing in these bonds, an applicant needs to read their documentation process.
The cash flows of Astrea 7 are being powered by 38 private equity funds and these funds cover almost 982 investee companies. Of note is the fact that the Class B bonds are being offered for the first time to the investors of the retail sector.
Of the total issue size of 200 million, almost 100 million are being sanctioned by the public. The remaining sum of $100 million will be stacked for the accredited investors alongside the institutional investors.
The retail investors should at least contribute SGD 2000 or amounts larger than that for making the A-1 public offer. If you want to go for the Class B public offer then a retail investor has to offer USD 2000 or more.
The chief highlights of the credit through the Astrea 7 bonds include the following;
- The bonds structurally safeguard and protect the interest of the bondholders.
- Portfolio diversification for private equity funds is available with the Astrea 7 bonds.
- Credit facility with currency hedges option beside stress test results.
The Astrea 7 bonds are very well diversified across the PE funds portfolio. The interest of the bondholders is protected and retail investors will be able to lay their hands on the Class B bonds for the first time ever. Investors can gain PE exposure with restricted downside risks. Thus, investors looking for the stable income options can rely on Astrea 7 bonds despite the market risks. If you want to invest in the Astrea 7 bonds, read this article to find out more about the bond structuring and their details.