Singapore, 2 June 2003...The Monetary Authority of Singapore (MAS) welcomes today's launch of the Asian Bond Fund (ABF) by the EMEAP group of central banks. As a member of the EMEAP grouping, Singapore will be investing US$100 million in the ABF. The initial size of the ABF will be about US$1 billion, and will be invested in a basket of US$ denominated sovereign and quasi-sovereign bonds issued by countries in the region. The ABF will be managed by the Bank for International Settlements (BIS).
The launch of the ABF is an important step in strengthening regional financial cooperation and demonstrates the close cooperation and commitment of the EMEAP group of central banks. Together with initiatives proposed in other regional fora, the ABF will help to promote the development of regional bond markets.
Joint EMEAP press statement on the Asian Bond Fund is attached.
EMEAP Press Statement EMEAP Central Banks to Launch Asian Bond Fund (2 June 2003)
The EMEAP (Executives' Meeting of East Asia and Pacific Central Banks) Group, comprising 11 central banks and monetary authorities in the East Asia and Pacific region, is pleased to issue this joint announcement on the launch of the Asian Bond Fund (ABF). All EMEAP members have agreed in principle to invest in the Fund. The Fund, which will have an initial size of about US$1 billion, will invest in a basket of US dollar denominated bonds issued by Asian sovereign and quasi-sovereign issuers in EMEAP economies (other than Japan, Australia and New Zealand). The Fund will be managed by the Bank for International Settlements in a passive style in accordance with a specific benchmark. The ABF is expected to start operation soon. The EMEAP Group will set up an Oversight Committee to monitor the performance of the Fund.
The launch of the US dollar ABF is an important step in regional co-operation aiming at promoting bond markets in the region. The EMEAP Group has been playing an active role in promoting the efficiency of financial intermediation in the region and the launch of the ABF will facilitate the channelling of a small portion of the very sizeable official reserves held by the Asian economies back into the region. The Fund will also provide a useful means for the Asian central banks to diversify their investments beyond the more traditional reserve assets and to enhance their returns.
After the launch of the US dollar ABF, the EMEAP Group will proceed to study the extension of the ABF concept to include bonds denominated in regional currencies, further strengthening the contribution of the initiative to the broadening and deepening of bond markets in the region.
Contact details for the 11 members of the EMEAP Group are as follows:
Reserve Bank of Australia Bob Rankin (61 2) 9551 8410 People's Bank of China Luo Jin (86 10) 6619 4956 Hong Kong Monetary Authority Thomas Chan (852) 2878 1480 Bank Indonesia Wahyu Widjajanti (62 21) 381 8116 Bank of Japan Kenichiro Watanabe (81 3) 3277 1518 Bank of Korea Sun-Byoung Chae (82 2) 759 5202 Bank Negara Malaysia Abu Hassan Alshari Yahaya (60 3) 2698 8044 Reserve Bank of New Zealand Kelly Eckhold (64 4) 4713 879 Bangko Sentral ng Pilipinas Amando M. Tetangco, Jr. (63 2) 524 8722 Monetary Authority of Singapore Diana Koh (65) 6229 9104 Bank of Thailand Thirachai Phuvanat Naranubala (66 2) 283 5030