Singapore Financial Regulator Sees No Impropriety by DBS in Hyflux Bond Sale

(Bloomberg) -- Singapore’s financial regulator said it hasn’t uncovered any impropriety by DBS Group Holdings Ltd. in arranging the sale of securities by troubled Singaporean water and power company Hyflux Ltd. in 2016.

DBS, Southeast Asia’s biggest lender, complied with regulatory requirements as both manager and distributor of the perpetual securities, the Monetary Authority of Singapore said Monday in a reply to Bloomberg questions.

Hyflux last week scrapped a pact with its would-be savior SM Investments Pte after disputes. The group of Indonesian businessmen agreed last year to rescue Hyflux in return for a majority stake, and the development prolongs the plight of about 34,000 retail investors who stand to lose almost everything.

“As the issue manager, DBS conducted due diligence checks to ensure that material information relating to Hyflux was highlighted in the offering document,” the MAS said. While distributing the bonds via its automatic-teller machines, the bank also reminded investors to read the disclosure documents before making their applications, the regulator added.

“All investments carry risks,” the MAS said. “The deterioration in Hyflux’s financial conditions that led to losses for investors illustrates this.”

DBS adheres to all guidelines and regulatory requirements with any bond taken to market, including processes to comply with disclosure requirements, the company said in an emailed comment.

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