New Issue Weekly Monitor
For the week beginning 3rd Jun 2019
Asia ex-Japan G3
For the week beginning 3rd June 2019, USD 3.32bn of bonds was issued from 8 deals.
Breakdown: USD 2bn of Investment Grade, USD 595m of High Yield bonds, USD 730m of Non Rated bonds.
The Asia primary debt market remained mostly sidelined with a holiday-ladened week in Asia while US Treasuries continued its rally at the back of weak macro data. Only Chinese issuers were active last week despite a Chinese long weekend. Investors pounced on the Investment Grade deals that were priced. Average price tightening from initial price guidance Investment Grade deals priced in the week increased 6.4bps to 25.7bps.
The highlight of the week was Guangdong Energy Group’s USD 500m 5 year Senior Unsecured RegS deal. The state-owned power supplier’s first offshore bond deal was 8.2 times covered, with a strong price tightening from Initial Price Guidance of 32bps as well. The bonds priced at T+128bp and the bonds were mostly placed into Asian fund managers. The deal performed strongly on the break, trading as much as 6bps tighter on the break
ICBC priced a jumbo dual tranche deal through its Luxembourg branch. The 3 year and 5 year FRNs were priced at the exact same levels as ICBC Singapore Branch’s 3 year and 5 year FRNs in April.
Shandong Commercial Group tapped USD 180mm of its 8.5% December 2021 bonds at 8% yield to bring total issuance size to USD 300mm. The Chinese conglomerate issued the original 3 year bonds in December last year at 9% yield.
For the week, 37 banks have been involved as Bookrunners or Lead Managers. China International Capital Corporation was the most active Bookrunner during the week, participating in 3 out of the 8 deals that were priced.
The new issue pipeline lights up with 9 new mandates announced in the week. There are 13 outstanding mandates announced over the last 2 weeks yet to price.