Last week, Asian investment-grade issuers enjoyed strong demand for US dollar bonds on the basis of subsidizing concerns about rising US interest rates and the relatively limited supply of corporate IGs so far this year.
Last week, six Asian IG corporate issuers sold dollar bonds which raised a total of US$3 billion. The US$800m dual-tranche deal with China Resources Land and GLP China Holdings' debut US$500m dollar bond were covered more than 10 times amid tight pricing, and aftermarket bonds traded tighter.
Books for two of the other sales, while not as impressive, were respectable. The US$500m bond was covered 4.7 times by Sun Hung Kai Properties and 2.7 times by Singapore Power's US$600m contracts.
Final figures were not available for Henderson Land Development's US$300 m problem and Chugoku Electric Power's US$300 m contracts.
Four of the six issuers (CR Property, SHK Properties, Singapore Power and Henderson Land) sold 10-year bonds, another sign of the growing appetite of investors for a longer term after the market reversed its view of the US monetary policy trajectory.
While the majority of supply is focused on HY land, a continuation from late last year, we expect more IG issuers to look for an issuance window in the next few weeks in the midst of the constructive market."
According to IFR data, Asian high-yield corporate issuers had sold US$16 billion of dollar bonds before last week, and investment-grade corporate issuers had sold only US$6.2 billion.
Reduced worries about a strong US dollar and full-blown trade war, coupled with proactive growth stimulus initiatives in the region, have promising investment opportunities in Asia, Allianz Global Investors said. "Strong historical returns, improved credit valuations and broadly stable credit fundamentals all indicate that the Asian bond market is well positioned for 2019," said David Tan, Allianz's Asia Pacific fixed income chief investment officer.
A Hong Kong-based fund manager from the fixed income department of a Chinese insurance firm said this year that he was actively purchasing bonds.
There's such a strong demand. Quick cash, which had been missing during last year's downturn, is also coming in,' he said, adding that finding good quality paper in the secondary market was not easy and therefore he needed to focus more on the primary market.
State-backed property developer CR Land, rated Baa1/ BBB+/BBB+, priced a US$300m 3.75 percent 5.5-year tranche last Tuesday and a US$500m 4.125 percent 10-year tranche with many years of rapid growth at Treasuries.
According to data researcher CoreLogic, house prices plummeted 4.8 percent nationally in 2018, with Sydney and Melbourne's prices slumping 11.1 percent and 7.2 percent from their respective 2017 peaks.
In addition, non-bank lenders rely heavily on the securitization sector for their funding needs because they lack retail deposits and access to the local senior unsecured, covered and offshore bond markets.
The PRS 23 A$22m Class C, A$16m Class Ds and A$9m Class E bonds, with 3.9, 3.9 and 3.7-year WALs, priced 330bp, 430bp and 630bp large one-month BBSW, both 10bp more than the corresponding notes of last November, are among the subordinated tranches. With a 2.7-year WAL, priced at a one-month BBSW plus 730bp, 20bp wide of the previous Class Fs, the PRS 23 A$8m Class F bonds.
The deal was completed with a 5.0-year WAL for A$9m Class G bonds. According to S&P, with 34.9 percent of loans with a scheduled LTV ratio above 80 percent, the portfolio has a relatively high weighted-average scheduled loan to value (LTV) ratio of 72.6 percent.
Borrowers with previous credit deficiency (default, judgment or bankruptcy) were issued around 21.6 percent of the mortgage loans in the portfolio, while around 34.9 percent were extended on an alternative documentation basis.
The ratings agency also states that the portfolio has 3.8 months of very low weighted-average seasoning, with 88.1% of loans originating in the past six months.
For the US dollar tranche, Citigroup was the sole lead boss, while for the Green Euro tranche, Societe Generale CIB and Standard Chartered were joint leaders.
Everything You Need to Know About Special Purpose Acquisition Company (SPAC)
The writer takes a look at Special Purpose Acquisition, and provides answers to some of the troubling questions raised by people interested in it.
Drive more traffic for your currency exchange website to increase growth
The currency exchange market is constantly evolving so in order to have an edge over your competitors, you must be up-to-date with the latest trends and development in your industry.
Reporter apologizes for Clinton Sex Article
In 1993, reporter David Brock set the stage for the president's current legal problems by revealing Bill Clinton's alleged sexual escapades while he was governor of Arkansas, in a story published in the conservative magazine The American Spectator.
CBD Vape Cartridges: Ingredients Check! How Beneficial?
Whether you want to quit smoking nicotine or wish to incorporate Cannabidiol in your routine, vaping is the most conventional way to jump right into the world of CBD.
Business Innovation Technology on Big Data
Just two simple words, Big Data, has created a furore that is spreading across the world, unleashing a dizzying array of opinions in all subjects - from healthcare to marketing needs, from politics to economics. Every day articles and blog posts are written about how to gather, store and use these big datasets.
How To Use CBD Oil To Get All The Health Benefits Of Cannabis (CBD)
CBD has been one of the two molecules that offer the biggest health effects, one of the hundreds in hemp, and is the short term for cannabidiol. Some other thing that gets the people "high," is tetrahydrocannabinol.
How To Use TikTok For Your Business
Gone are the days of print ads as more social media platforms take the spotlight. We started off this revolution seeing the birth of social media influencers on Instagram and now, we have TikTok overtaking all other social media platforms with its immense growth in users.
The Saudi Arabia Monarchy
The Saudi government maintained strict limits on citizens' political rights and civil liberties in 2004, despite taking some steps forward in a slow and quiet process of political reform carefully managed from above by the royal family. The monarchy continued a series of national dialogues on reform and finalized plans for a series of limited municipal elections in certain parts of the country in early 2005, but it implemented few tangible changes directly affecting Saudi citizens' rights.
The Importance of Professional Foundation Repairs in Washington
When your foundation becomes damaged, it is vital that you get it repaired as soon as possible before the problems get any worse. Foundation damage can cause all sorts of issues around your home, and this includes problems that can create safety hazards, cause aesthetic issues, and lower the value of your home.
Things You Wanted to Know About Sofia Hublitz
The American actress Sofia Hublitz is indeed a real personality in the film.
William Jefferson (Bill) Clinton: President of the United States of America
The completion and consolidation of the enlarged European Union, the preservation of peace and security, as well as peaceful and constructive participation in world politics are based on the community of Europe and the United States of America.