NTUC Income AR 2019

NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2019 18. BORROWINGS Life Insurance Par Fund 2019 $’000 2018 $’000 Lease liabilities 46,186 – Bank borrowing 418,181 417,291 464,367 417,291 Description Issue Date Maturity Date 2019 $’000 2018 $’000 Bank borrowing 17 January 2017 17 January 2022 418,181 417,291 The bank borrowing of $420,000,000 (2018: $420,000,000) was refinanced on 17 January 2017 and is repayable on 17 January 2022. The effective interest rate at reporting date is 2.44% (2018: 2.55%) per annum and the interest rates are re-priced every three months to the SGD-SOR rates. The bank borrowing is secured by the following: (i) a legal mortgage over the investment property (Note 7); (ii) an assignment of all the rights, title and interest of the Company in and to the proceeds arising from the sale and lease of the investment property; (iii) an assignment of all the rights, title and interest in and to the insurances of the Company in relation to the investment property; and (iv) a loan with legal charges over the assets of the Company (including restricted cash) and shares of the Company. Shareholders’ Fund Description Issue Date Maturity Date 2019 $’000 2018 $’000 $600 million 3.65% subordinated notes 23 August 2012 23 August 2027 599,582 599,435 On 23 August 2012, the Co-operative issued $600 million subordinated notes (“Notes”) due 2027 callable from 2022. The Notes will initially bear interest at the rate of 3.65% per annum, payable semi-annually on 23 February and 23 August of each calendar year up to 23 August 2022. If the Notes are not redeemed or purchased and cancelled on 23 August 2022, the interest rate from that date will be reset at a fixed rate per annum equal to the aggregate of the then prevailing five-year SGD swap offer rate and 1.88%, payable semi-annually in arrears. The Notes qualify as Tier 2 capital for capital adequacy purposes. At the reporting date, the fair value of the subordinated debt is $619,320,000 (2018: $615,540,000). 128 HERE FOR SURE