UBS, Bursa Malaysia, UnionBank rally around ‘bond in a box’ POC

UBS, Bursa Malaysia, and Union Bank of the Philippines are joining Hashstacs (STACS) and Deutsche Bank as industry collaborators in their proof-of-concept known as “Project Benja”. 

The three companies contributed their various domain expertise towards the final Environmental, Social, and Governance (ESG)-enabling and interoperable end-to-end Distributed Ledger Technology (DLT)-enabled bonds lifecycle management solution for the financial industry.

Sharing its perspective as a bond arranger and investor, UBS provided insight into primary market workflows, ESG and green bond formats including sustainability-linked bonds, and ESG-focused investor preferences. UBS also focused on payment interoperability and explored the viability of a range of digital payment and settlement modes.

In order to achieve an effective end-to-end DLT-enabled capital market, Bursa Malaysia’s expertise was to consider the possibilities of a blockchain-powered Central Securities Depository that allows for efficient and orderly maintenance of records, which could unlock massive value and opportunities for the industry. This, bearing in mind that fragmentation in information stemming from different legacy systems used in the financial industry has been raised by all collaborators as a major pain point.

UnionBank shared its expertise as a cross-border bond issuer, covering current pain points that issuers face in the traditional capital markets financial infrastructure, requirements for cross-border issuances, as well as social inclusion and micro, small and medium enterprises financing.

With the inputs of the various industry collaborators, the practicality, interoperability, relevancy, sustainability, and effectiveness of the solution created by STACS and Deutsche Bank to simplify global markets in a sustainable and inclusive manner, are validated and reinforced.

“We were able to successfully achieve the project’s goals in a fast few months thanks to the great collaboration and inputs from the team at Deutsche Bank, as well as industry leaders at UBS, UnionBank of the Philippines, and Bursa Malaysia,” said Benjamin Soh, managing director at STACS.

“(They) allowed us to truly approach the project from a lens of interoperability, ecosystem-wide roles and impacts of DLT digitalisation on the traditional processes of securities markets, including the enablement of better ESG and sustainable financing,” said Soh.