Wholesale Corporate Bonds

Introduction

Wholesale Corporate Bonds are bonds issued by companies under the Companies (Wholesale Corporate Bonds) Regulations 2021 of the Reserve Bank of Fiji (RBF), which facilitates issuances of corporate bonds to eligible wholesale investors under s283(4)(d) of the Companies Act 2015.

This new product offering is anticipated to help develop a more vibrant stock market in Fiji by offering investors an opportunity to invest in a wider range of assets while simultaneously offering companies an alternative platform to raise capital. To encourage issuance of Wholesale Corporate Bonds on the SPX, the following incentives apply:

A company whose corporate bond is listed on the SPX, shall be allowed deduction of 150% on prescribed costs incurred for listing the bonds;
A company whose corporate bond is listed for trading on the SPX, will be allowed deduction of 150% on the interest payments made by it to bondholders under the terms of issue of the corporate bond; and
Interest income earned on corporate bonds traded on the SPX shall be exempt from withholding tax in the hands of the bondholder.

The Listing and Trading Rule Book lays out the rules and procedures of the SPX that apply to companies wanting to issue and list their Wholesale Corporate Bonds on the SPX. The SPX has also established a subsidiary company, SPX Trustees Limited (SPXT) in 2021 which has been approved by the RBF to undertake the function of a Trustee in relation to borrowers that conduct bond issuances under the Companies (Wholesale Corporate Bonds) Regulations 2021. The Central Share Registry Limited (CSRL), is also equipped to provide bond registry services for the Wholesale Corporate Bond issuers.

Fijian Holdings Limited (FHL), a SPX listed entity since 1997 became the first entity to issue and list its Wholesale Corporate Bonds on the SPX on 7th December 2022. Click here to read the SPX Press Release in regards to this listing.

The current listed Wholesale Corporate Bonds are tabulated below:

Issuer Name	Bond Identifier	Issue Date	Offer Amount	Coupon Rate	Terms (months)	Maturity Date
Fijian Holdings Limited	FHLWCB30112025	30/11/2022	$15,200,000	3.00%	36	30/11/2025
Fijian Holdings Limited	FHLWCB30112027	30/11/2022	$10,800,000	3.50%	60	30/11/2027
Fijian Holdings Limited	FHLWCB30112029	30/11/2022	$4,000,000	3.75%	84	30/11/2029