SINGAPORE, Jan 15, 2026, 15:50 SGT — Regular session
- UOB shares slipped 0.4% after the bank revealed pricing details for S$850 million in perpetual capital securities
- The lender also announced a new share buyback and indicated when it will release full-year results
- Traders are focused on next week’s bond settlement and the earnings report set for Feb. 24
Shares of United Overseas Bank dipped 0.4% to S$36.37 on Thursday following the announcement that the Singapore-based lender priced S$850 million in perpetual capital securities with a 3.00% coupon, callable first in 2033.
Singapore’s benchmark Straits Times Index gained 0.2%, but focus on UOB has turned to near-term capital moves after it notified the exchange it will release its full-year 2025 financial results on Feb. 24, before the market opens.
A separate bourse notice revealed UOB repurchased 38,000 shares on Wednesday through market purchases, canceling them for roughly S$1.38 million.
The perpetual capital securities offer a fixed 3.00% distribution until they reset on Jan. 21, 2033. After that, the rate moves to the prevailing seven-year SORA-OIS plus an initial spread of 0.94%, per the terms. UOB has the option to redeem the perpetuals starting from that first reset date or on subsequent distribution dates, but only with approval from the Monetary Authority of Singapore. The issue is set to price for settlement on Jan. 21, 2026.
Rivals showed strength. DBS Group climbed 0.8%, and OCBC also added 0.8% in delayed trading.
Perpetual capital securities like these usually count as Additional Tier 1 (AT1) capital — a bank buffer ranking above common equity but beneath senior debt. They boost regulatory ratios without diluting equity, though investors see the coupon as a quick gauge of funding expenses.
SORA-OIS, a benchmark based on the Singapore Overnight Rate Average, prices interest-rate risk in Singapore dollars. Its reset feature lets the coupon adjust to local rate conditions once the first call date arrives.
AT1 instruments have riskier downside features compared to standard bonds: coupons might be halted, and the notes can be written down if regulators declare a bank non-viable. A spike in credit market stress or rising risk premiums could rapidly push up the cost of new capital and drag down bank shares.
Equity investors face a tight schedule of key events. Traders will focus on price action near settlement next week before turning to Feb. 24, when UOB reports full-year results and provides updates on capital management, including buyback momentum.
