Tag: unionbank

StanChart and UnionBank of the Philippines Collaborate on PoC of $187 Million Blockchain-Powered Bond

The UnionBank of the Philippines and Standard Chartered (StanChart) have created a proof of concept required in the issuance of a blockchain-powered retail bond. The blockchain platform intended for bond tokenization was co-developed by SC Ventures, StanChart’s innovation and ventures arm, and UnionBank.

Bond tokenization

The tokenized retail bond worth $187 million (9 billion pesos) was mirrored on the blockchain platform and involved a three and 5.25-year dual issuance. According to the announcement:

“Orders received were tokenized and stayed within existing retail bond guidelines. The tokens issued mirrored the traditional transaction but were not allocated directly to investors.” 

Ephyro Luis Amatong, a commissioner at the Philippines’ Securities and Exchange Commission, noted that the result could be instrumental in measuring the effectiveness and efficiency of tokenization and the distributed ledger technology (DLT).  

Addressing the needs of retail investors

According to Aaron Gwak, StanChart’s head of capital markets, the use of blockchain technology, tokenization, and DLT could be a game-changer in making the bond market accessible to retail investors. He acknowledged:

“The bond infrastructure around the world has been designed primarily for institutional investors and involves a number of intermediaries to buy and subsequently trade bonds, making it less accessible to retail investors.”

Jose Hilado, UnionBank’s CFO added:

“The marriage of a digital order-taking platform and backend infrastructure driven by tokens is the future of retail bonds. We are keen to see the day when investors can buy and sell bonds, even on the secondary markets, at a click of a button on their phones.”

In September, Thailand’s central bank deployed a blockchain-enabled platform in the issuance of government bonds to improve investor’s buying experience, boost operational efficiency, and minimize costs. 

In other news, StanChart CEO Bill Winters recently disclosed that the widespread creation and mass adoption of digital currencies was absolutely inevitable. 

Union Bank of Philippines Cooperates with Hex Trust for Promoting Pilot Digital Assets Custody Service

Union Bank of Philippines (UnionBank) announced Wednesday the bank has paired with Hong Kong-based Hex Trust to pilot digital assets custody service.

In response to maturing space and growing interest in digital assets and blockchain technology, and the need for trust and regulated institutions to manage digital assets from retail and institutional investors, this partnership will start by Hex Trust to provide internal services for the bank’s employees as a trial run, before “fully commercialised digital assets service” to the public, according to the press release.

UnionBank believes the cooperation will help the bank enter the digital asset sector as a pioneer by fully complying with compliance with Bangko Sentral ng Pilipinas (BSP) regulation.

Henry Aguda, Chief Technology and Operations Officer, Chief Transformation Officer of the Union Bank of the Philippines, indicated that the market demand in the various forms of digital assets, including cryptocurrency, NFTs, or tokenised assets are arising, he said in the statement:

“We are excited to be the first Philippine bank to pilot a custody service for digital assets for our own employees, overseen by the BSP, so that we can prepare the groundwork for a safe and protected system for customers’ digital assets,”  

The HK-based Hex Trust said the company provides “bank-grade service” to their customers. Calvin Shen, Head of Sales & Business Development of Hex Trust, said:

“Hex Trust’s collaboration with UnionBank enables secure access to the digital asset ecosystem via our award-winning enterprise-level custody platform. Millions of the bank’s customers will soon have access to this new asset class,”

In May, Hex Trust has paired with Chianalysis to provide a compliance-driven custody solution for financial institutions. The Trust is also expanding to the European market in this remaining year, the company said.  

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