My first Publication ocbc_ar17_fullreport_english | Page 197

21. DEBT ISSUED (continued)
21.1 SUBORDINATED DEBT (UNSECURED) (continued)
(d) The subordinated notes can be written off in whole or in part if the MAS determines that the Bank would become non-viable.
Interest is payable semi-annually on 19 June and 19 December each year at 4.25% per annum. The Bank had entered into interest
rate swaps to manage the risk of the subordinated notes and the cumulative fair value change of the risk hedged is included in the
carrying value. The subordinated notes qualify as Tier 2 capital for the Group.
(e) The subordinated note was issued by the Bank to its wholly-owned subsidiary, OCBC Capital Corporation (2008) in exchange
for the proceeds from the issue of the $1.5 billion non-cumulative non-convertible guaranteed preference shares (Note 16).
The subordinated note is redeemable at the option of the Bank on 20 September 2018 and each interest payment date thereafter.
Interest will, if payable, be made semi-annually on 20 March and 20 September each year at 5.10% per annum up to 20 September
2018, and thereafter quarterly on 20 March, 20 June, 20 September and 20 December each year at a floating rate per annum equal
to the 3-month Singapore Swap Offer Rate plus 2.50% if the redemption option is not exercised.
(f) The Innovative Tier 1 (“IT1”) Capital Securities are redeemable in whole at the option of OCBC Malaysia on 17 April 2019 and each
interest payment date thereafter. Interest is payable semi-annually on 17 April and 17 October each year at 6.75% per annum up to
17 April 2019, and thereafter at a floating rate per annum equal to the 6-month Kuala Lumpur Interbank Offer Rate plus 3.32% if
the redemption option is not exercised. In addition, the IT1 Capital Securities are to be redeemed in full with the proceeds from the
issuance of non-cumulative non-convertible preference shares on 17 April 2039. The IT1 Capital Securities qualify as Additional
Tier 1 capital for the Group.
(g) The subordinated bonds were fully redeemed by OCBC Malaysia on 15 August 2017.
(h) The perpetual notes were fully redeemed by OCBC Wing Hang on 20 April 2017.
(i) The subordinated bonds were fully redeemed by OCBC NISP on 30 June 2017.
(j) The subordinated notes are redeemable in whole at the option of GEL on 19 January 2021. Interest is payable semi-annually on
19 January and 19 July each year at 4.60% per annum up to 19 January 2021, and thereafter at a fixed rate per annum equal to the
then prevailing 5-year Singapore Swap Offer Rate plus 1.35% if the redemption option is not exercised.
BUILDING ON OUR CORPORATE STRATEGY FOR SUSTAINABLE GROWTH
195