A spokesman for DBS Bank told The Covered Bond Report that its wholesale funding programmes are being gradually and selectively broadened, responding to speculation that it could issue covered bonds following the release of a consultation paper by the Monetary Authority of Singapore.

MAS released the consultation paper on 9 March and market participants have suggested that DBS Bank would be a leading candidate for covered bond issuance. The bank also recently advertised for a position in its treasury citing covered bonds among the role’s competences.

The DBS spokesman did not comment directly on the covered bond speculation, but outlined the bank’s approach to funding.

“DBS is well-capitalised and we have a very strong liquidity position,” the spokesman told The CBR. “Our customer deposit base is very stable and well diversified, and will continue to be the core funding source of DBS.

“Over the last year, we have been gradually expanding our wholesale programmes, and these are used selectively where we think there are opportunities to diversify our funding sources and secure longer term funds at cost competitive pricing.”

Fitch on Friday also played down the prospects of Singaporean covered bond issuance, noting the focus on deposits of the country’s banks and also financial authorities.