(Recasts with demand levels, comment in paragraph 3) HONG KONG/SINGAPORE Jan 13 (Reuters) - Singapore Airlines launched its first U.S. dollar bond on Wednesday, attracting demand for over $1.5 billion, according to a term sheet seen by Reuters. The deal is to help fund the purchase of new aircraft and make aircraft-related payments among others, the term sheet showed. “Despite the absence of CoC (change of control) put protection for the new bonds (as well as its existing debt including bank loans, as per management), it has a proven track record of support from the Singapore government via Temasek, particularly during the pandemic period,” Eric Liu, a credit desk analyst at Nomura’s sales and trading desk said in a note. The size of the deal has yet to be officially set but is expected to be a ‘benchmark’ transaction which means it should raise at least $300 million, according to a source with direct knowledge of the matter. A final size will be calculated once investors have placed their orders, the person said. The source could not be named as the information had not yet been made public. There has been a rush of debt issuances from airlines in the past six months as carriers build up cash levels to cushion themselves against the financial impact of the coronavirus pandemic while hoping for a travel rebound as more countries launch vaccination campaigns. There have been 19 deals in that time worth $17.62 billion, the largest of which was a $6 billion issue from Delta Air Lines in September, according to Refinitiv data. Potential Singapore Airlines investors have been told the initial price guidance for the 5.5 year deal is set at the US treasury yield plus 300 basis points. It is the first US dollar bond issued by Singapore Airlines. Singapore Airlines has traditionally issued debt in its local currency but the latest bond, which cannot be sold to investors in the United States, will help the airline diversify its funding sources, according to people working on the deal who were not authorised to speak to media. The airline said on Monday its December passenger capacity was down 81.3% compared to the same time last year. (Reporting by Scott Murdoch in Hong Kong and Anshuman Daga in Singapore; Editing by Michael Perry & Simon Cameron-Moore)