Singapore Adds 20-Year Maturity to Sovereign Green Bond Programme

Singapore launched its first 20-year sovereign green bond, seeking to raise between S$2.1 billion and S$2.6 billion (US$1.63 Bn to US$2.02 Bn) to finance long-term sustainable infrastructure projects, according to a term sheet reviewed by Reuters.

DBS, Deutsche Bank, HSBC, OCBC and Standard Chartered are arranging the Singapore dollar-denominated bond, which will mature on August 1, 2046. The bond had initial price guidance of about 2.55%, the Reuters-reviewed term sheet showed.

The offering will be Singapore’s first 20-year Green Singapore Government Securities (Infrastructure), or Green SGS (Infrastructure) bond, broadening a sovereign green-bond curve that previously comprised 30- and 50-year debt.

The sale includes S$50 Mn reserved for retail investors in Singapore, while as much as S$2.55 Bn may be allocated to institutional and other investors. The Monetary Authority of Singapore (MAS) can adjust the final issue size and the split between retail and institutional investors depending on demand. The bond is expected to settle on August 3 and be listed on the Singapore Exchange, according to Reuters.

Proceeds will be allocated to eligible green expenditure under the Singapore Green Bond Framework, which covers eight categories, including clean transport, renewable energy, energy-efficient buildings, water infrastructure, climate adaptation and circular-economy projects. The framework requires the government to fully allocate net proceeds within two years and report annually on their use and environmental impact.

Singapore’s sovereign green bonds are issued under the Significant Infrastructure Government Loan Act, or SINGA, which allows the government to borrow for major infrastructure expected to benefit multiple generations.

To qualify, projects must be legally owned and controlled by the government, cost at least S$4 Bn and have a useful life of at least 50 years. They must also support or materially improve national productivity or Singapore’s economic, environmental or social sustainability.

The green-bond programme forms part of Singapore’s effort to finance its transition towards net-zero emissions while developing the city-state as a regional centre for sustainable finance. The government has said the public sector, including statutory boards, plans to issue up to S$35 Bn in green bonds by 2030.

Sovereign issuance is also intended to establish pricing references for companies and other borrowers seeking to raise green capital, according to the Ministry of Finance (MOF).

Singapore’s domestic green-bond market began taking shape in the private sector. Property developer City Developments issued the country’s first green bond in April 2017, raising S$100 Mn. The proceeds were used to repay a loan that financed energy- and water-efficiency improvements at Republic Plaza.

DBS followed in July 2017 with a US$500 Mn issue, becoming the first Singapore financial institution to sell a green bond.

MAS also introduced a Green Bond Grant Scheme in June 2017 to reduce the additional cost of obtaining external reviews and certifications. The programme was expanded in February 2019 into a broader Sustainable Bond Grant Scheme covering social and sustainability bonds, with sustainability-linked debt added later.

The sovereign market followed five years later. Singapore published its first Green Bond Framework in June 2022 and sold an inaugural S$2.4 Bn, 50-year sovereign green bond that August. The bond carried a 3% coupon and was priced to yield 3.04%, with demand equivalent to 2.17 times the amount issued.

The government reopened the 50-year bond in September 2023, raising another S$2.8 Bn. The transaction was 1.4 times subscribed and was also priced to yield 3.04%.

In June 2024, Singapore added a 30-year maturity to the programme, raising S$2.5 Bn through its first 30-year sovereign green bond. The issue carried a 3.25% coupon, was priced to yield 3.30% and attracted applications worth about 2.4 times the amount offered.

The 50-year bond was reopened through an auction in October 2024, raising S$1.5 Bn. The auction drew subscriptions equivalent to 1.6 times the amount issued, according to MOF’s FY2024 Green Bond Report.

MAS bond records show that subsequent reopenings lifted the outstanding stock of the 30-year sovereign green bond to S$5.8 Bn. The 50-year bond had S$7.7 Bn outstanding, taking Singapore’s sovereign green-bond stock to S$13.5 Bn before the new 20-year sale.

The new offering will broaden that curve further and give investors another maturity through which to gain exposure to Singapore’s green infrastructure programme.

The government has so far directed sovereign green-bond proceeds towards two major rail projects: the Jurong Region Line and the Cross Island Line. Both qualify under the clean-transport category of the framework and are intended to improve public transport connectivity while reducing reliance on private vehicles.

MOF’s latest published allocation report covers the position as of March 31, 2025, and S$9.2 Bn was raised through sovereign green bonds issued between August 2022 and October 2024. Of that amount, S$5.6 Bn had been allocated to the two rail projects, while S$3.6 Bn from the June and October 2024 issues remained unallocated.

MOF said the remaining S$3.6 Bn was expected to be fully allocated to the Jurong Region Line and Cross Island Line by March 31, 2027.

When fully operational, the two rail lines are expected to avoid between 100,000 and 120,000 tonnes of carbon-dioxide-equivalent emissions annually, according to government estimates. That is comparable to removing at least 22,000 internal-combustion-engine cars from Singapore’s roads.

Singapore updated its Green Bond Framework in January 2025 to align it with the Singapore-Asia Taxonomy for Sustainable Finance, as well as international and ASEAN green-bond standards. The revised framework retains eight categories of eligible expenditure and requires external review of the framework, project-selection process and reporting.

The new 20-year issue will test investor demand at a shorter maturity than Singapore’s earlier sovereign green sales. Its final pricing and order book will also indicate whether the labelled debt commands a so-called greenium, meaning investors accept a lower yield than on conventional Singapore government securities of a similar maturity.