OCBC launches $1 billion blockchain-powered US commercial paper programme
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SINGAPORE: The city-state’s second-largest bank, Oversea-Chinese Banking Corporation (OCBC), announced a new US$1 billion (S$1.28 billion) digital US commercial paper programme. According to a recent AOL report, this indicates an important move in its digital bankrolling policy that taps into the US$1.4 trillion US commercial paper market.
In a calculated initiative to reinforce its dollar capital capabilities, OCBC has employed blockchain technology to introduce the programme. This new initiative complements its existing US$25 billion conventional commercial paper programme, which started in 2011.
The digital programme allows the bank to raise short-term funds more efficiently by issuing tokenised commercial papers. This is a cost-effective instrument that helps corporations manage their immediate liquidity needs.
The first tokenised issuance under the new programme was completed on Aug 20. JP Morgan’s Digital Debt Service platform was the sole dealer for this issuance.
“Singapore’s blockchain ecosystem is moving quickly, and asset tokenisation is gaining real traction. Our focus is now firmly on commercialisation,” said Kenneth Lai, OCBC’s head of global markets. He emphasised the bank’s goal to lead in digital finance.
Funds raised through this programme will be used for general funding purposes, according to a statement from the bank.
With this move, OCBC joins a growing number of global financial institutions using blockchain to streamline operations and find new funding sources. This signals a new era for digital debt markets.