The Singapore bond market has become an important, open capital market in Asia over the past decade. It has grown considerably in terms of size, depth, and liquidity.

Sovereign bonds and statutory board bonds are a vital feature, despite the government’s strong fiscal position that does not require deficit financing. Singapore Government Securities (SGS)—comprising SGS bills and bonds—are issued primarily to stimulate market activity and to provide a benchmark for corporate issues. Statutory board papers, issued by autonomous government agencies, are considered the most liquid among debt instruments on the Singapore corporate bond market.

Special Purpose Vehicles (SPVs) are the major issuers of corporate debt securities in the market, with structured debt comprising a large portion of SGD-denominated issues. Structured products include equity-linked notes, convertible bonds, credit-linked notes, and asset securitization transactions.

To attract greater foreign interest, the Monetary Authority of Singapore (MAS) began internationalizing the SGD in 1998, with foreign entities allowed to issue SGD-denominated bonds. Singapore’s debt market has grown to become an important source of financing for local and foreign corporations, international organizations, and governments.

Islamic finance is growing in importance as well. In 2005, Singapore was accepted as a full member of the Islamic Financial Services Board (IFSB), an international body based in Malaysia that defines regulatory and supervisory standards governing Islamic financial services. In January 2009, Singapore launched its first Islamic bond program worth SGD200 million.

The aims, philosophy, and strategy behind Singapore's bond market development are discussed at the websites linked below.