Standard Chartered and PGGM have successfully executed Shangren VII, the first risk-sharing deal in Singapore to receive capital relief. This transaction, finalised in March 2025, involves a $1.5 billion portfolio of trade finance loans to companies across Asia, the Middle East, and Africa. It is part of Standard Chartered’s long-standing synthetic significant risk transfer securitisation programme, Shangren.
Shangren VII is notable for being the first transaction of its kind to recognise capital relief benefits in a Singapore banking subsidiary. The deal employs a dual-credit default swap structure, allowing Standard Chartered to claim capital relief both at the group level and within its Singapore entity. Teo Puay Tin, Head of Distribution, Credit and Portfolio Management at Standard Chartered, stated, “Shangren VII testifies the successful extension of the dual-CDS structure and adds risk-sharing securitisation into our Singapore subsidiary’s toolkit for its balance sheet capital and risk management.”
The collaboration between Standard Chartered and PGGM dates back to 2008, with Shangren VII marking their twelfth credit risk-sharing transaction. This partnership previously led to the first capital relief transaction in Hong Kong in 2022. Barend van Drooge, Deputy Head of Credit Risk Sharing at PGGM, commented, “This transaction with Standard Chartered is especially meaningful as it further expands recognition of credit risk-sharing as a valuable credit risk and capital management tool in Asia.”
The successful execution of Shangren VII underscores the evolving landscape of risk-sharing in the financial sector, potentially paving the way for similar transactions in the region.
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