The Asia G3 bond market navigated Sino-American trade war jitters carefully last week. Issuers were mostly sidelined as the trade war narrative continues to unravel.

New Issue Weekly Monitor

For the week beginning 6th May 2019
Asia ex-Japan G3

Summary

For the week beginning 6th May 2019, USD 7.27bn of bonds was issued from 9 deals.

Breakdown: USD 4.5bn of Investment Grade, USD 2.77bn of High Yield bonds.

The Asia G3 bond market navigated Sino-American trade war jitters carefully last week. Issuers were mostly sidelined as the trade war narrative continues to unravel. While the sentiment was cautious, rare benchmark issuers were able to access the market successfully. The Republic of Philippines tapped the return to the Euro bond market after a 13 year hiatus while MGM China rode strong investor demand for diversification to price a dual-tranche jumbo deal.

MGM China Holdings priced USD 1.5bn across the 5 and 7 year tenor at 5.5% and 6% yield respectively. The gaming company saw strong investor demand for the new issue, which allowed it to increase the total issuance size to USD 1.5bn, up from the initial indication of USD 1.25bn. Investor demand rolled over into the secondary market as both tranches traded more than 1 point above reoffer.

Yankuang Group reopened its 6% January 2022 bonds for another USD 500m at 5.5% yield. The Chinese mining company last priced the original bonds back in January this year at 6%. The tap deal saw orders reach over USD 1.4bn as the deal eventually priced 30bps tighter from initial price guidance. The bonds traded up on the break.

For the week, 32 banks have been involved as Bookrunners or Lead Managers. Bank of China was the most active Bookrunner during the week, participating in 3 out of the 9 deals that were priced.

The new issue pipeline continues to swell with 8 new mandates announced in the week. There are 17 outstanding mandates announced over the last 2 weeks yet to price.

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