This is especially true for the issuance of hard-bullet covered bonds, where there is no grace period to liquidate assets as part of the terms of the bonds. In some cases, a pre-maturity test is used to trigger the collateralisation of bonds maturing in the coming 12 months.
The proposed rules will give programmes that issue hard-bullet bonds the ability to hold cash assets in excess of the 15% limit to fund such maturing covered bonds.
- See more at: http://sbr.com.sg/financial-services/news/singapore%E2%80%99s-coveted-covered-bond-market-open-mid-2015#sthash.waE54pbf.dpuf