Anonymous

18 Apr 2019

∙

General Investing

Since Singapore doesn't do debt financing, what is the whole point of SSB and SGS?

Singapore's government spending has been rather prudent, leading to consistent budget surpluses that mean that the government do not have to issue debt to sustain spending. So why was the SSB and SGS even created for?

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Yixiong Chang

18 Feb 2019

SGS is issued for the needs of the economy and financial markets. SGS bonds and Treasury bills (T-bills) are issued to meet banks’ needs for a risk-free asset in their liquid-asset portfolios. And also other institutions such as insurers/nonbanks will need such risk-free assets. It is also part of Singapore broader strategy to grow Singapore as an international center for asset management/debt capital management etc.

The Tbills/bond yields will also serve as benchmark riskfree rates in the market.

SSB is created to provide singaporeans with another option for savings, complementing CPF/SRS and other investment tools in the market.

Singapore government invest the monies received from issue these bonds. If the investmentdebt cost, our nation's reserves will grow.

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