THE $600 million certificate of deposit issue by Standard Chartered Bank was made to provide strong backing for its long-term assets, general manager Ian Wilson said yesterday.
''It was an exercise in prudential balance sheet management,'' Mr Wilson said, adding it did not represent a change in the bank's financing approach.
The issue is structured with a five-year maturity and carries an interest rate of 0.35 per cent over the Hong Kong Inter Bank Offered Rate (HIBOR). It was arranged by Standard Chartered Asia, which was in the underwriting group that included five other banks.
Standard Chartered Asia executive director David Jackson said foreign banks should be attracted by the issue because it would have only a 20 per cent risk-adjusted weighting on their balance sheets.
He anticipated the offer would be closed by the end of June and expected banks, securities houses and what he described as ''other funds'' would buy the notes.
For Standard Chartered Bank, making a floating rate note (FRN) issue was the obvious route because of the uncertainty in the market for fixed-rate debt securities, he said.