Issuance in the Asia bond market slowed down last week as Chinese high yield real estate issuers tapped the bond market at lower yield levels.

New Issue Weekly Monitor

For the week beginning 22nd Apr 2019
Asia ex-Japan G3

Summary

For the week beginning 22nd April 2019, USD 2.01bn of bonds was issued from 5 deals.

Breakdown: USD 1.3bn of Investment Grade, USD 430m of High Yield bonds and USD 280m of Unrated bonds.

Issuance in the Asia bond market slowed down last week with only Chinese issuers active. China International Capital Corporation priced a dual tranche jumbo deal while Chinese high yield real estate issuers tapped the bond market at lower yield levels.

Chinese real estate issuers capitalize on good investor demand to price bonds at lower yields.

  • Redco Properties Group priced USD 180m of 2 year bonds at 10.25%. Redco Properties last priced USD 250m of 364-Days bonds at 13.5% in January this year.
  • Xinyuan Real Estate re-opened USD 100m of its 2.5 year bonds at the yield of 12.3%. The company issued the original 2.5 year notes early this month at 14.2%.
  • Yango Group also re-opened USD 150m of its 2 year bonds at the yield of 9.625%. The company issued the original 2 year notes in late March this year at 10.25%.

China International Capital Corporation priced USD 1bn of bonds across 3 year fixed and floating rate notes. Order books for the 3 year floating rate notes were more than double that of the 3 year fixed rate notes as books were more than 4 times covered. Bonds were mostly placed into banks and the floating rate notes performed better in the secondary market.

For the week, 24 banks have been involved as Bookrunners or Lead Managers. Orient Securities was the most active Bookrunner during the week, participating in 3 out of the 5 deals that were priced.

New issue pipeline continues to build, with 4 new mandates announced yet to be priced.

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