New Issue Weekly Monitor
For the week beginning 11th Mar 2019
Asia ex-Japan G3
For the week beginning 11th Mar 2019, USD 2.9bn of bonds was issued from 15 deals.
Breakdown: USD 2.5bn of Investment Grade, USD 350m of High Yield bonds and USD 57.9m of Unrated Bonds.
New issue activity slowed down into the earnings season. Market printed the lowest weekly new issuance volume since the 1st week of January 2019(excluding Chinese Lunar New Year week). Hong Kong & China companies were the only active issuers tapping the Asia dollar bond market. China Orient Asset Management (International) Holding priced a dual tranche USD 700m deal on the back of a mammoth orderbook while Xinjiang Financial Investment made its debut in the offshore bond market.
China Orient Asset Management (International) Holding priced USD 700m across the 5 and 10 year tenor at T+150bps and T+200bps respectively. The Chinese AMC last issued USD 1bn of 10 year bonds in December 2017 at a spread of T+205bps. Orderbooks were 22 times and 31.7 times covered for the 5 and 10 year tranches respectively. Banks took majority of allocation in the 5 year tranche while fund managers took majority of the 10 year tranche. Momentum on the deal was strong, with the new bonds pricing inside the secondary curve. The bonds continue to perform on the secondary market, trading more than 10bps tighter by the end of the week.
China National Travel Service Group priced USD 500m of 3 year bonds at T+110bps. The deal saw good demand from investors as final order books reached USD 6.8bn from 160 accounts. Asian fund managers took majority of allocation and bonds performed on the break, trading as much as 18bps tighter.
For the week, 45 banks have been involved as Bookrunners or Lead Managers. HSBC was the most active Bookrunner during the week, participating in 4 out of the 7 deals that were priced.
New issue pipeline builds up, with only 4 new mandate announced and yet to be priced.