14/08/2017

• Allianz SGD Income Fund seeks to provide long-term capital appreciation and/ or income in Singapore Dollar terms
• Diversified portfolio of average investment grade rating focusing on SGD bonds, with USD-denominated bonds to enhance returns
• Income distribution from the fund will be made on a monthly basis (intended at 3-5% per annum)*

Allianz Global Investors (“AllianzGI”), one of the world’s leading active investment managers, today announced the launch of the Allianz SGD Income Fund (“Fund”). The Fund aims to provide long-term income and/or capital appreciation in Singapore Dollar terms by investing primarily in debt securities, and will be available to both retail and institutional investors. The launch period of the Fund will be from 7 – 18 August 2017, with the inception on 21 August 2017.

The Allianz SGD Income Fund will capture opportunities in Singapore’s growing fixed income market by investing predominantly in SGD bonds, with additional sources of returns and diversification through USD-denominated bonds. It seeks to provide stability through a diversified portfolio investing primarily in investment grade credits, with selective allocation to high-yield credit for yield enhancement. Non-SGD bond exposures will be hedged to minimise currency volatility. The Fund intends to provide a payout of 3- 5% p.a. distributable on a monthly basis*. 

The Fund will be managed by portfolio managers who are part of AllianzGI’s award-winning Asian Fixed Income team. Based out of Singapore, Hong Kong and Taipei, the team actively manages strategies that focus on generating alpha whilst minimising downside risks, and currently oversees over USD 3.8bn in assets under management. The team is led by David Tan, Chief Investment Officer, Fixed Income, Asia Pacific region, who has over 24 years of experience managing Asian fixed income portfolios. 

The past few years have shown that emerging markets, especially those from Asia, have become fundamentally more solid. Asia now makes up 78% of new issue allocation for credit, and the region’s corporate high-yield default rates are amongst the lowest as compared to other emerging markets¹. Locally, Singapore’s bond market has also seen exponential growth over the past decade, from less than S$50 billion in 1996 to S$333 billion as of December 2016 ².

Commenting on the launch, David Tan said: “Today’s low-yield and uncertain economic backdrop has given rise to a global hunt for income, and we are seeing growing investor demand for solutions that provide attractive and steady yield with some risk protection. Singapore’s strong credit rating and resilient fundamentals paint a strong outlook amidst recent economic growth data which suggests positive signs of recovery. The Allianz SGD Income Fund allows us to invest into the market’s potential for long-term, stable income and we are excited to bring these opportunities to our investors.”

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* Dividend payments are applicable for Class AM Dis (monthly distribution) and not guaranteed. Dividend may be paid out from capital.

¹ J.P.Morgan, Bond Radar, as at end June 2017

² AsianBondsOnline, Monetary Authority of Singapore, Bloomberg LP., as at 30 December 2016