Oversea-Chinese Banking Corporation (OCBC) has launched aUS$1 billion US commercial paper (USCP) programme powered by blockchain technology, the firm said on Tuesday.
Through the initiative, the Singaporean bank will be able to unlock near-instant short-term US dollar financing capacity, enabling it to receive funds within minutes thanks to tokenised securities and on-chain funds.
OCBC confirmed on Tuesday that JP Morgan will act as the sole dealer for the programme through its Digital Debt Service application, built on the Kinexys tokenisation platform.
The initiative aims to strengthen the company’s liquidity resilience in the current uncertain geopolitical and macroeconomic environment, OCBC added.
“It is an alternative channel to tap the deep and liquid US$1.4 trillion USCP market to quickly raise USD, complementing our conventional US$25 billion USCP programme established in August 2011,” OCBC said in a statement.
OCBC confirmed the lender issued its first tokenised USCP last Wednesday. The six-month bonds were sold to an accredited institutional investor, and OCBC received the proceeds minutes after the transaction was completed.
In addition to issuance and settlement, the registration and management of the USCP will also be carried out on-chain.
OCBC said it is the first USCP issuer in the world to harness blockchain throughout the entire lifecycle of the securities, reducing reliance on traditional infrastructure, intermediaries and legacy payment systems.
“As Singapore’s blockchain ecosystem continues to evolve, our sights are set on commercialisation and expanding our asset tokenisation capabilities” OCBC added.
Kenneth Lai, head of global markets at OCBC, emphasised that the programme aims to strengthen investor engagement and enhance OCBC’s profile in global capital markets.
“The speed and transparency of this solution have only strengthened our conviction in blockchain’s transformative power for capital markets,” said Lai.
In April, Kinexys Liink, part of JP Morgan’s blockchain business unit, partnered with Phixius by Nacha, a secure peer-to-peer payment information networks, to enable information exchanges between the two networks.
The companies said at the time that the move would improve account validation coverage for financial institutions, FinTechs and corporations.
JP Morgan described Kinexys Liink as the “world’s first” bank-led, peer-to-peer network for data sharing between institutions and FinTechs.
