January 2020 Singapore Savings Bonds is 1.76%

The effective interest rate for January 2020 Singapore Savings Bonds (GX20010T) is 1.76% if you held it for 10 years. This is an improvement as compared to 1.71% for December 2019 issue of the Singapore Savings Bonds. The minimum amount you can purchase for Singapore Savings Bonds is S$500. If you decide to hold and sell it for 1 year, the effective interest rate is 1.52% which is worst than what fixed deposits can offer.

If you have 10K or more and can afford to lock down the money for 1 year or more, you can consider fixed deposits as compared to Singapore Savings Bonds for that higher interest rate.

If you have monies sitting in your Supplementary Retirement Scheme account, why not consider placing SRS monies with Singapore Savings Bonds for a higher interest? (Read more: Purchase Singapore Savings Bonds with SRS in 2019)

DBS Multiplier Account + Singapore Savings Bonds

If you hold a DBS Multiplier Account, you can perhaps try the hack I previously wrote about to achieve a higher interest rate payout. (Read more: Earn More Interest With DBS Multiplier Account + Singapore Savings Bonds).

Tracking Singapore Savings Bonds via Stocks Café

My favorite website, Stocks Café has introduced a new feature to allow adding of Singapore Savings Bonds into your portfolio. If you didn’t know, I signed up as a Friend of Stocks Café as my most favorite feature of Stocks Café is the automated tracking of dividends payout.

I have renewed my subscription with Stocks Café and this is the second year that I continue to use Stocks Café to track my dividends.

Tracking Singapore Savings Bonds via My Savings Bonds Portal

MAS has launched My Savings Bonds Portal where you can track your Singapore Savings Bonds purchases separately from your stock purchases. I have done up a simple guide here. (Read more: Guide to My Savings Bonds Portal)

Frasers Logistics and Industrial Trust and Frasers Commercial Trust Announce Proposed Merger

Investors have already felt something fishy last Friday when both Frasers Commercial Trust and Frasers Logistics and Industrial Trust requested for a trading halt. Today, Frasers Logistics and Industrial Trust and Frasers Commercial Trust announced a proposed merger by way of trust scheme.

In conjuction with the merger, Frasers Logistics and Industrial Trust also proposed the acquisition of 50% interest in Farnborough Business Park from a wholly-owned subsidiary of Frasers Property Limited. The remaining 50% is currently held by Frasers Commercial Trust (Read more: My Personal Analysis Of Frasers Commercial Trust) After the merger, Frasers Logistics and Industrial Trust will hold 100% of Farnborough Business Park.

With the merger, the total assets will be worth approximately S$5.7 billion and the enlarged REIT will be one of the top 10 S-REIT by market capitalisation with index representation.

Frasers Commercial Trust unitholders will receive

  • S$0.151 in cash for each unit; and 
  • 1.233 new Frasers Logistics and Industrial Trust units at an issue price of S$1.240 per unit.

I shall not dive into other rationale that the manager gave for the proposed merger. As a dividend investor, I am only keen in the dividend yield after the merger. The merger is expected to be DPU accretive on a pro forma basis for both Frasers Logistics and Industrial Trust unitholders and Frasers Commercial Trust unitholders by 2.2% and 4.2% respectively.

After the news of the merger broke out, share price of Frasers Commercial Trust has also gone up by 2.40%.

Summary of November 2019 Transactions

In this month of November, I have made two stock transactions. The first is that I have subscribed to the rights offered by Mapletree Commercial Trust. I have applied for excess rights and gotten all the excess rights that I have applied for. This surprises me as based on past experiences, I never gotten any excess rights that I have tried to apply for. This is also given Mapletree Commercial Trust is such a popular REIT. With the addition of new units, you can see that Mapletree Commercial Trust now occupies 11% of my stock portfolio in terms of invested value.

You probably might be wondering which is the second stock transaction that I have made. I have purchased Frasers Commercial Trust at S$1.61. Based on the price of S$1.61, the current dividend yield is 5.57%. This is much more than the current month’s issue of the Singapore Savings Bonds whereby the interest rate has fell to a level beyond my interest. I have skipped this month’s purchase of Singapore Savings Bonds and placed my monies with Frasers Commercial Trust since the yield is much higher.

Moving ahead, I probably will refrain from purchasing Singapore Savings Bonds should the yield worsen. I shall look for pockets of opportunities in the current stock market in terms of dividend yield to make regular purchases.

One of the best features that I liked about Stocks Café is the report function whereby I can see the dividends that I have collected based on the stocks that I held in my stock portfolio. Since most of the dividends are in, I shall be sharing with you whether I have met my goal of 11K passive income next month.