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China’s Belt & Road Initiative has the potential to transform growth across a long line of emerging economies along the
expanded trading route. President Xi Jinping’s signature scheme has already triggered massive infrastructure developments
to improve connectivity between China, South-East Asia and Europe, as governments and contractors step up cross-border
investments.
Financing, however, is another story. Many projects are based in frontier countries with underdeveloped capital markets,
and investors need to be comfortable taking long-term exposure to often unpredictable political regimes – not to mention
the potential fallout from a worsening Sino-US trade dispute. The dominance of Chinese investors has also raised
questions, especially as China has made it clear that it is not prepared to shoulder all the risks itself.
IFR will bring together a panel of experts to debate these challenges, as well as potential opportunities for capital
markets participants as the BRI gathers pace. Titled “Connecting issuers and investors with regional investment
opportunities”, the Roundtable will discuss:
• Is the Belt & Road Initiative commercially viable? What is the investment case?
• What funding options are open to businesses and sponsors looking at BRI investments?
• How can investors gain exposure to “Belt & Road” assets?
• Do the international capital markets have a role to play?
• How can issuers navigate China’s financial markets? What kinds of approvals are needed?
• Are there any risks that are unique to BRI investments?
• How can institutional investors mitigate these risks?
• What is the impact of the US-China trade war?
The event is free to attend, but you must be registered. To secure your place, please complete the
short form at http://financial-risk-solutions.thomsonreuters.info/IFRAsiaBeltAndRoad
Upfront
OPINION INTERNATIONAL FINANCING REVIEW
Sponsored by:
The IFR US ECM Roundtable will take place on the afternoon of Thursday September 13 2018 at
the Thomson Reuters Building, New York.
Now in its seventh year, the event will bring together a panel of the most senior ECM practitioners
to assess the current state of the market, discuss the latest trends and developments and provide
an outlook for the remainder of the year and beyond.
The event is free to attend, but you must be registered. To secure your place, please complete the
short form at http://financial-risk-solutions.thomsonreuters.info/US_ECM_Roundtable
Contents
INTERNATIONAL FINANCING REVIEW
AUGUST 25 2018 ISSUE 2248
TOP NEWS 04
EQUITIES Mothballed Aramco IPO put on hold as Saudi eyes other sources of cash for
Vision 2030 programme. Sabic deal seen as preferred way to raise funds. 04
BONDS Cashing in German banks Berlin Hypo, Commerzbank and Deutsche, eager to
access cheap funding, wasted little time in raising senior preferred debt. 04
BONDS Brave trade Intesa’s €1bn five-year senior secured bond issue was the first in this
format from an Italian bank since April, yet attracted more than €1.7bn in orders. 05
BONDS Blockchain first The World Bank has successfully issued the first public
offering of blockchain bonds with a A$110m two-year Kangaroo. 06
Ambitious San Miguel targets Philippines ECM record with Ps124bn SMFB follow-on in October. 07
Nadir Turkish bank loans dive in secondary market. Prices hit a six-year low. 08
Unpopular Former Banco Popular shareholders seek redress from Spanish government for losses. 09
Bonds Syndication moves into the 21st century. US banks join forces to disrupt new issuance model. 10
PEOPLE & In a fix Issuers of £312bn of FRNs due to mature in 2021 have been warned 11
MARKETS they could become fixed if nothing is done to address their references to Libor.
Capital breach Credit Agricole has been fined €4.8m by the ECB for failing
to keep to procedures on how some unspecified instruments should be classified. 12
Jumping ship M&A banker Philip Noblet, who advised Cineworld on its
US$5.8bn acquisition of Regal Entertainment, is to leave HSBC to join Jefferies. 13
Balancing act Deal-hungry investment bankers walk Tesla tightrope. 17
Expansion Moody’s and S&P have published detailed applications for rating licences in China. 18
Looking East New breed of brokers eye Chinese advisory business. 18
BONDS Blockbuster Rabobank’s senior non-preferred debut blows the doors off. 19
Bounceback NAB excels on return to euros. 27 UK RMBS Santander skips sterling, goes for dollar. 33
EMERGING Dialogue Angola opens talks with IMF. Move meets with bondholder approval. 43
MARKETS Rosy glow SingTel basks in Temasek’s halo. 43 Survival Turkey stabilises but outlook rocky. 46
LOANS Unsettling Italian bank funding costs rise on the back of political uncertainty. 49
China Dalian Wanda revives loan plan. 51 Japan More lenders sought for SoftBank refi. 53
EQUITIES LatAm Brazil, Mexico lead issuance pipeline but politics could limit execution. 61
Comeback KBS Realty plans return to SGX. 61 Results Post-IPO interims a mixed bag in Europe. 66
BY GARETH GORE deal has come to a complete Falih in a statement, referring to disentangling Aramco from the
HALTûINûRECENTûMONTHSûASû2IYADHû Aramco’s plan to buy a US$70bn state proving complex, another
The eagerly awaited IPO of SAUDI focuses on other sources of stake in Saudi Arabia Basic plan was sought.
ARAMCO, billed as the biggest raising cash. Industries Corporation. Sabic is the solution: PIF owns
STOCKûmOTATIONûINûHISTORYûHASû Aramco chairman Khalid Al 70% of the petrochemical
been kicked into the long grass &ALIHûSAIDûhSPECULATIONvûTHATûTHEû PREFERRED OPTION manufacturer, and Aramco’s
as the kingdom focuses on IPO had been cancelled was Bankers say the Sabic deal has purchase of that stake will
raising cash for its Vision 2030 wrong, adding that “the fast become the preferred way provide the sovereign wealth
goals by other means. government remains committed FORû2IYADHûTOûRAISEûFUNDINGûFORû fund with much of the funding
First announced in early 2016, to the IPO of Saudi Aramco at a its vast Vision 2030 programme, it needs without having to list
the listing was a central tenet of time of its own choosing when which will see the country’s the oil giant.
Crown Prince Mohammed bin CONDITIONSûAREûOPTIMUMv Public Investment Fund invest In recent days, PIF has also
Salman’s plans to overhaul the It initially said the listing heavily to develop new signed a deal to borrow US$11bn
ECONOMYûANDûlLLûAûGAPINGûHOLEû would happen in 2018. In recent INDUSTRIESûANDûJOBSûTOûHELPû from banks - almost double the
INûSTATEûlNANCESû4HEûSALEûOFûAûû months it indicated the deal diversify away from its current US$6bn that it had been seeking
stake was expected to raise would more likely come in 2019. dependence on oil. WHENûTALKSûlRSTûBEGANû)TûISûTHEû
around US$100bn, four times But now the deal has been The PIF, Saudi’s sovereign lRSTûEVERûCOMMERCIALûLOANûFORû
more than any previous IPO. DELAYEDûINDElNITELY wealth fund, was to be the PIF. It is extremely rare for a
JP Morgan, Morgan Stanley, “This timing will depend on recipient of any money raised sovereign wealth fund to take
HSBC, Moelis and Evercore were multiple factors, including from an Aramco listing. But, out a syndicated loan.
mandated to prepare for the favourable market conditions, WITHûAûPROJECTEDûVALUATIONû “In that triangle of Sabic-
listing. Bankers on the deal and a downstream acquisition falling well short of the crown Aramco-PIF, there is a lot going
say that, while ties have not which the company will pursue prince’s publicly stated target of ONvûSAIDûONEûBANKERûCLOSEûTOûTHEû
been formally severed, the INûTHEûNEXTûFEWûMONTHSvûSAIDû US$2trn and the process of Aramco IPO, who said that some
BY HELENE DURAND including €40m of lead manager “No other German issuer PRICE DISCOVERY
interest. had issued anything like it. Also, "UTûWHILEû"((ûISSUEDûTHEûlRSTû
German banks, eager to access “As one of Germany’s most unlike other European trade, Commerzbank faced the
cheap funding, wasted little expensive credits, it was very JURISDICTIONSûWHEREûTHEYûBUILTû task of establishing the right
time in raising senior preferred GOODûTOûBEûTHEûlRSTvûSAIDû"ODOû their senior non-preferred clearing level for the country’s
debt last week, with BERLIN HYPO Winkler, Berlin Hypo’s head of curve on top of their senior larger lenders.
(BHH), COMMERZBANK and DEUTSCHE funding and investor relations. preferred, our outstanding 7HILEûJURISDICTIONSûWITHû
BANK all setting out their stalls in As a member of Germany’s senior legacy bonds are senior outstanding senior preferred
the market. saving banks group, BHH NON
PREFERREDû7EûHADûTOûlNDû and SNP offered an obvious
Unlike other European BENElTSûFROMûAûJOINTûLIABILITYû the right pricing between senior yardstick for the differential
countries where legislators scheme, and its covered and non-preferred and covered between the two, German
ensured their banks had the senior unsecured debt is 0% risk- BONDSv banks already have a stack
option of issuing senior weighted. The paper ended up with of SNP whereas other
preferred alongside costlier “It could have been pricing closer to the issuer’s lenders are still building
senior non-preferred, German challenging to come directly senior non-preferred levels that layer.
banks only had the option of AFTERûAûCHEAPERûTRANSACTIONvûSAIDû than its covered bonds, !ûLEADûONûTHEû!!n!nûRATEDû
raising SNP until recently. Winkler which were quoted between trade put fair value on a new
Belatedly, Germany At the 13bp over mid-swaps 11.2bp and 15.6bp through lVE
YEARû3.0ûINûTHEûHIGHûSû
implemented legislation that lNALûPRICINGûTHEû!A.2!nû mid-swaps when the deal was over mid-swaps and a new 10-
effectively introduced a two- rated deal was one of tightest announced. YEARûATûBPnBP
track senior market last month, senior preferred deals priced in “While we will want to keep a )TûMEANTûTHATûATûTHEûlNALûBPû
teeing up the opening trades in 2018. decent layer of SNP in the and 65bp over mid-swaps prints,
this new asset class. h4HEûDIFlCULTYûWASûOFûCOURSEû future, our focus for the time THEûõBNûlVE
YEARûANDûõMû
"((ûlREDûTHEûOPENINGûSALVOû BEINGûTHEûlRSTûASûTHEREûWASûNOû being will be on senior preferred and 10-year were priced at a
pricing a €300m 0.375% August BLUEPRINTûFORûTHISûTYPEûOFûTRADEvû when it comes to benchmark similar spread differential to
2023 issue on books of €375m, said Winkler. ISSUANCEvûSAIDû7INKLER other countries.
F&R ready for launch 08 Spain sued over Popular 09 21st century bond syndication 10
BY JOHN WEAVERS Andrea Dore, the World James Wall, executive general cryptobond for Queensland
Bank’s head of funding, said the manager of institutional Treasury Corp in January 2017
The World Bank has successfully groundbreaking deal had been banking and markets using the bank’s capital markets
ISSUEDûTHEûlRSTûPUBLICûOFFERINGûOFû hANûEXCELLENTûEXPERIENCEv international at CBA, said: blockchain platform.
blockchain bonds with a “All the investors who showed “Since announcing the mandate,
A$110m (US$82m) two-year interest during the marketing the interest we’ve received for QUICKER SETTLEMENT
Kangaroo, arranged by sole lead stage participated in the Bondi has been overwhelming. It The new bond issue does not
manager Commonwealth Bank of TRANSACTIONûANDûAûFEWûMOREûJOINEDû is clear the market is ready and fully embrace blockchain
Australia. us later in the process. We hope to open to the uptake of emerging technology as payments will still
The INTERNATIONAL BANK FOR learn more about this technology technologies and sees the be made via the existing SWIFT
RECONSTRUCTION AND DEVELOPMENT’s by being engaged through the life potential evolution of the capital system to avoid the 10%
2.2% August 28 2020s were CYCLEûOFûTHISûBONDv MARKETSv Australian goods and services tax
priced last Thursday at 99.901 4HISûISûTHEûlRSTûTIMEûGLOBALLYû ONûlAT
CURRENCY
LINKEDûTOKENS
for a yield of 2.251%, 23bp wide “We hope to learn that a legally binding bond issue “We are yet to work out the
of asset swaps and in line with is being created, allocated, BENElTSûINûTERMSûOFûCOSTûUSINGû
standard Kangaroo bonds issued
more about this transferred and managed the blockchain platform for this
by Triple A rated supranationals. technology by being through its life cycle solely using bond but we have demonstrated
The Blockchain Operated New engaged through the distributed ledger technology. the principle that this
Debt Instrument, or Bondi for life cycle of this bond” The bond’s blockchain technology could be used to
short, was issued from the platform was built and developed EFlCIENTLYûSETTLEûTRANSACTIONSvû
)"2$SûEXISTINGûGLOBALûDEBTû Participating investors include by the CBA Blockchain Centre of said Paul Snaith, the World
issuance facility. It will be traded CBA, First State Super, NSW Excellence, housed in the Sydney Bank’s treasury head of capital
on a consortium blockchain Treasury Corporation, Northern Innovation Lab. markets operations.
platform operated by the World Trust, QBE, SAFA, and Treasury CBA previously established an “The settlement was done at
Bank and CBA. Corporation of Victoria. experimental non-tradeable 4ûDAYSûBUTûITûCOULDûHAVEûBEENû
BY FIONA LAU Aû53
LISTEDû#HINESEûBIOTECHûlRMû BIOTECH and US-based cancer- liver-disease treatments. It started
after BeiGene. detection start-up GRAIL are to commercialise a hepatitis C
Chinese biotech issuers are The growing pipeline shows eyeing US$500m offerings each virus drug candidate in June.
pushing ahead with Hong Kong that the drastic drop in Ascletis early next year.
IPO plans despite the dismal Pharma’s share price has not
PERFORMANCEûOFûTHEûCITYSûlRSTû deterred other biotech issuers SPECIAL CASE “You can’t create
listing under new rules for the from going public in the city. Industry executives see Ascletis a biotech sector
fast-growing sector. Ascletis raised HK$3.1bn as a one-off, rather than a sign of overnight. You can’t
Last Monday, HUA MEDICINE, 53M ûINûTHEûlRSTûLISTINGû things to come. really put too much
which focuses on diabetes since Hong Kong eased its rules “Ascletis is a special case.
weight in one company
treatment, started pre- TOûWELCOMEûBIOTECHûlRMSûWITHû Different from other early-stage
MARKETINGûAûmOATûOFûABOUTû NOûPROlTSûORûREVENUESûBUTûHASû biotech companies, Ascletis has
in one month or even
US$200m. ASCENTAGE PHARMA and tumbled since its August 1 a drug in the market already and one year”
MABPHARMûALSOûlLEDûFORû listing. The stock closed at its drug is facing intense
respective US$300m and HK$8.46 last Friday, 40% below competition given some other “We will go ahead with our
US$200m IPOs last week. the IPO price of HK$14. companies are selling similar Hong Kong IPO plans, and I
Ascentage develops Nine mostly Chinese biotech drugs in the market at lower think other biotech issuers will
treatments for cancer, hepatitis companies so far, including Hua, PRICESvûSAIDûAûSENIORûMANAGERûATû do the same as the fundraising
B and age-related diseases, while Ascentage and Mabpharm, have Aû#HINESEûBIOTECHûlRMûTHATûISû size, and probably valuation, of
Mabpharm produces lLEDûFORûAû(ONGû+ONGû)0/û!NDû planning a Hong Kong listing BIOTECHûmOATSûHEREûISûHIGHERû
monoclonal antibody drugs for the pipeline continues to build next year. THANûINûTHEû53vûSAIDûTHEûSENIORû
cancers and autoimmune WITHûSOMEûHIGH
PROlLEûNAMESû “So Ascletis is not really a real manager.
diseases. set to follow suit. test of investor appetite for Ascletis and Nasdaq-listed
Nasdaq-listed ZAI LAB is also TASLY BIOPHARMACEUTICAL is early-stage biotech companies BeiGene, which raised
CONSIDERINGûAû(ONGû+ONGûmOATû PLANNINGûTOûlLEûAûLISTINGû which develop novel medical HK$7.08bn from a dual primary
next year, people familiar with APPLICATIONûFORûAû53BNûmOATûASû TREATMENTSvûHEûSAID listing in Hong Kong, both
the situation said last week, in early as next month, while Founded in 2013, Ascletis comfortably beat the biggest US
what would be the second from Fosun-backed SHANGHAI HENLIUS specialises in anti-viral, cancer and BIOTECHûmOATûTHISûYEARûINûWHICHû
BY SANDRINE BRADLEY with potentially further negative loans for TURK EKONOMI BANKASI NOTûBEûSUFlCIENTûTOûOVERCOMEû
implications for Turkish banks and TURK EXIMBANK. GARANTI BANK lenders’ fears of increased risk
Turkish banks’ secondary loan and corporates that have large and YAPI VE KREDI BANKASI were and systemic problems in
prices have hit their lowest point EXTERNALûFUNDINGûNEEDSvû talking to banks about Turkey’s banking sector.
since early 2012, further Moody’s said. RElNANCINGûLOANS The biggest drop in secondary
complicating their efforts to h!KBANKûISûDElNITELYûONûHOLDû pricing was a 2.4 percentage
RElNANCEûBILLIONSûOFûDOLLARSûOFû “The market has seized the client itself suggested to wait point fall for a €498.5m loan for
LOANSûASûTHEûCOUNTRYSûlNANCIALû up, it’s now showing TILLûAFTERû%IDvûAûSECONDûBANKERû ING BANK AS, which was signed in
crisis shows no signs of easing. said. THEûlRSTûBIANNUALûRElNANCINGû
Average secondary bids for
quite wide offers, but round earlier this year, to 96.3
Turkish bank loans hit 97.94 on I’m not sure how real MORE EXPENSIVE on August 20.
August 20, 114bp lower than they are” Falling secondary prices suggest Loans signed between March
99.08 on August 1, according to that Turkish banks will have to and May for Garanti Bank,
LPC data. This is the lowest level Political volatility, a 37% drop pay higher interest margins to Isbank, Yapi Kredi, Ziraat Katilim
since January 2012 when loans in the value of the lira and access the loan market. This may Bankasi and Turk Eximbank are
touched 97.89 after Turkish troops Turkey’s deteriorating relations
were killed on the Iraqi border. with the US have shaken the TURKISH BANKS’ SECONDARY LOAN PRICES
Turkey’s banks have to market and several Turkish bank Average bid
RElNANCEû53BNûOFûTHEû loans that were in the market in (% of par)
100.0
US$7bn of Turkish loans that are August are now on hold.
due to mature by the end of the Lenders are assessing the 99.5
2011
2012
2013
2014
2015
2016
2017
2018
“The risk of continued !û53MûRElNANCINGûFORû
lNANCIALûSTRESSûISûSIGNIlCANTû AKBANK is on hold along with Source: Thomson Reuters LPC
BY MAX BOWER equivalent debt deal, which backs LAUNCHEDû4HOMSONû2EUTERSû buyout of German energy
Carlyle’s and GIC’s carve-out of the lNANCINGûWHICHûCOMPRISESûAû metering business TECHEM, closed
Syndication of the US$13.5bn company’s chemicals business, but US$8bn Term Loan B and a at 375bp in July. Pricing was
debt package backing arranging banks believe that there US$5.5bn bridge loan, to large ADJUSTEDûHIGHERûONû4ECHEMSû
Blackstone’s buyout of THOMSON ISûSUFlCIENTûLIQUIDITYûINûTHEû institutional investors in late loan from initial guidance of
REUTERSû&INANCIALûANDû2ISKû European and US markets to June. BAML is leading the loans 350bp.
division is expected to launch in ABSORBûTHEûTWOûJUMBOûDEALS and JP Morgan the bonds. %BITDAûADJUSTMENTSûANDû
THEûlRSTûWEEKûOFû3EPTEMBERûATû “The market can take it; LEVERAGEûFORû4HOMSONû2EUTERSû
the same time as a €7.3bn debt there’s a huge amount of TOUGHER LINE &2ûDIVISIONû
ûTOûBEûREBRANDEDû
lNANCINGûBACKINGûTHEûBUYOUTûOFû LIQUIDITYûOUTûTHEREvûAûSENIORû 4HEûlNANCINGûPACKAGEûISûLARGELYû 2ElNITIVûATûCLOSEû
ûHAVEûNOTû
AKZO NOBEL’s chemicals business. LEVERAGEDûlNANCEûBANKERûSAIDû unchanged, bankers said, undergone any material changes
4HOMSONû2EUTERSûLOANûANDû adding that the workload on despite a softening in the market from the previously reported
bond package is expected to investors will be spread among in the early summer in Europe numbers of US$650m and
launch in Europe on September 3 analysts as the deals are in as investors took a tougher line roughly six times respectively,
and in the US on September 4 after different sectors. with arranging banks amid a which takes the business’s
the Labor day holiday. The deal is “The analysts on the buyside surge in supply. Ebitda from the US$1.7bn
THEûLARGESTûBUYOUTûlNANCINGûSINCEû looking at these two deals are Indicative pricing on reported number to near
the crisis and its launch has been going to be different people so it 4HOMSONû2EUTERSûTERMûLOANSûISû US$2.4bn, the senior leveraged
eagerly awaited since the deal was SHOULDNTûBEûAûPROBLEMvûTHEû 400bp, of which US$2.5bn- lNANCEûBANKERûSAID
underwritten in January. banker said. equivalent is expected in euros. “The deal has a lot of the
Syndication is likely to overlap Lead banks JP Morgan, Bank of Several buyout loans, including classic features of a leveraged
with Akzo Nobel’s €7.3bn- America Merrill Lynch and Citigroup a €2.6bn deal backing the buyout; there are a lot of
NOWûQUOTEDûnûPERCENTAGEû
points lower at around 97, the
fears about the country’s
economy mount. Spain sued over
data show, although little Akbank had already increased
trading is taking place.
“The market has seized up, it’s
PRICINGûBYûBPûTOûBPnBPû
on its US$940m loan, which is
Popular resolution
now showing quite wide offers, on hold and has not had further People & Markets Former bank shareholders seek redress
but I’m not sure how real they price revisions as yet. from government for losses
are and they have not been
TRANSACTEDvûTHEûlRSTûBANKERûSAID “Turkish banks may BY CHRISTOPHER SPINK the drastic resolution of the bank
Turkey’s Finance Minister and cut-price sale to Santander.
have to be more
Berat Albayrak held a Mexican billionaire Antonio del The documents state that
conference call on August 16 in
realistic, there may not Valle has launched actions Santander had told authorities it
a bid to reassure investors, be enough appetite to against the Spanish government would be prepared to buy the
which was followed by a take the deals that are for its role in the process of bank out of resolution but not in
STATEMENTûFROMûTHEûlNANCEû out there” putting BANCO POPULAR into a conventional private sale.
ministry the following day. resolution and subsequent sale Santander declined to comment.
The statement said that the “There are deals out there in for €1 to Santander. The Mexican group states this
lNANCEûMINISTRYûWOULDû the market. Nothing has Valle was the largest prevented other investors,
continue to seek foreign changed on those deals since shareholder in Popular but including existing holders of
lNANCINGûINûINTERNATIONALû launch, other than the currency existing investors were wiped out securities, from making their
markets, and from foreign SITUATIONvûAûTHIRDûBANKERûSAID in the resolution and sale. He and own proposals, in violation of
direct investments to underpin Bankers say that Turkish banks a group of other Mexican the applicable international law.
the economy. Qatar pledged to could have to settle for smaller investors, who in aggregate The Mexican investor group said
invest up to US$15bn in Turkey deals if some lenders choose not owned 4% of Popular, will argue they had already been approached
two weeks ago. to roll over their commitments, that the government’s role about possible measures such as a
4URKEYSûlVE
YEARûCREDITû or even repay the loans. breached the bilateral investment rights issue underwritten partially
default swaps were at 473.6bp “Turkish banks may have to treaty between Mexico and Spain. by Deutsche Bank and Barclays,
on Thursday, down from be more realistic, there may not They claim Spanish but these were ignored.
487.5bp on August 17 and a high be enough appetite to take the government bodies exacerbated “Spain denied investors fair
of 574.5bp on August 13. DEALSûTHATûAREûOUTûTHEREvûAû the situation which led to them and equitable treatment, a
fourth banker said. incurring losses of €470m. stable and predictable legal and
SETTLE FOR LESS? S&P said it expected a recession 4HEûGROUPûHASûlLEDûTWOû regulatory environment,
Although many Turkish banks next year while Moody’s said a international arbitrations protection against arbitrary and
are part-owned by international weakening of Turkey’s public simultaneously against Spain. non-transparent measures
banks, lenders’ support for their institutions had made These allege that by various affecting their investments, and
bank loans is not guaranteed as policymaking less predictable. actions, Spain did not guarantee AGAINSTûUNLAWFULûEXPROPRIATIONvû
that investors were given “fair SAIDû*AVIERû2UBINSTEINûPARTNERûATû
ANDûEQUITABLEûTREATMENTvû LAWûlRMû+IRKLANDûû%LLISûWHICHû
opportunities for cost cuts. If existing equity, based on the leading to the expropriation of is representing the investors.
anything the leverage may be &2ûUNITSû53BNûVALUATIONû their investments without The group has already brought
lower than before but there’s not that will be rolled over. adequate compensation. actions against the European
MUCHûCHANGEûTHEREvûHEûSAID Blackstone’s carve-out is still 4HEIRûMAJORûCOMPLAINTûISûTHATû #OMMISSIONûANDû3INGLEû2ESOLUTIONû
awaiting regulatory approvals, then economy minister Luis de Board at the European Court of
including the US, having 'UINDOSûnûVICEûPRESIDENTûOFûTHEû Justice. In addition in the New
“The analysts on the secured EU approval on July 23, European Central Bank since York courts it has also sought from
buyside looking at but this is unlikely to delay the THISû*UNEûnûANDûGOVERNMENTû Santander further information
these two deals are debt syndication. Loan investors agencies, such as the Bank of about what the bank knew ahead
going to be different will earn a commitment fee on Spain and bank rescue fund the of its agreement to buy Popular.
people so it shouldn’t the bridge loan and a ticking fee &2/"ûFAILEDûTOûTAKEûAPPROPRIATEû With regard to this action
on the Term Loan B before the measures to prevent the against Spain itself, the investors
be a problem” deal closes. effective bank run in the weeks had already informed the
“With any leveraged buyout leading up to Popular’s government it wanted to lodge a
Leverage was previously you don’t want to waste resolution on June 7 2017. claim under the bilateral
expected to be around 4.5 times investors’ time if the deal isn’t 4HEûARBITRATIONûlLINGSûCLAIMû investment treaty on January 22
through the secured debt and sure to happen but Thomson Spanish state bodies themselves this year. Spain has not responded
5.6 times total debt after Ebitda 2EUTERSûISûVERYûWELLûADVANCEDvû took money out of the bank to that initial approach.
ADJUSTMENTSûWHICHûCOULDûBEûASû the banker added. during this period. This, together Under the treaty, after six
much as 30%, as the transaction Blackstone announced on with the refusal to grant €6bn of months a claimant can then
is a carve-out and involves January 30 that it was buying a emergency liquidity assistance commence arbitration proceedings.
reallocating costs. ûMAJORITYûSTAKEûINû4HOMSONû “to overcome the liquidity crisis Mexico’s new membership of
The deal also includes US$1bn 2EUTERSû&2ûUNITûWHICHû that Spain itself had substantially the International Centre for
of preferred equity - with a INCLUDESû)&2 CAUSEDvûTHENûhCAUSEDûDEPOSITORSû Settlement of Investment Disputes,
14.5% payment-in-kind coupon - !û4HOMSONû2EUTERSû TOûPANICv from the beginning of August,
US$3bn of cash equity from spokesperson declined to The investors say this was then means the artiration will be heard
Blackstone and US$2.5bn of comment. USEDûASûAûJUSTIlCATIONûTOûCARRYûOUTû by this arm of the World Bank.
BY ELEANOR DUNCAN, OLD PIPES squeeze out the banks and After some initial talks,
DAVIDE SCIGLIUZZO The call for modernisation become an exclusive provider at however, the initiative stalled.
resonates well with the buyside, the top end - a single, Etrading Software is now
Try as it might, Wall Street has given that traders at some of the MONOPOLISTICûVENDORv working with the three US
not been able to get it right LARGERûlRMSûAREûINUNDATEDûWITHûAû The decision by Blackstone banks on the development of
when it comes to creating a mURRYûOFûCALLSûANDûMESSAGESûFROMû and Goldman to sell Ipreo to their platform, which is still
sophisticated and technically each of the bookrunners on every data provider IHS Markit in May known informally by the same
savvy system to distribute new bond deal that hits the market. for US$1.86bn helped soothe nickname, the two people said.
corporate bond issues. “When a deal is announced some of those fears. BAML, Citigroup and JP
Over the past few years, banks usually you end up getting a chat “Markit is a better place for Morgan declined to comment
and investors have tinkered with message, an email and a call from them than being owned by two on their relationship with
a handful of ideas on how to THEûSAMEûBANKvûSAIDûONEûTRADER VAMPIREûSQUIDSvûTHEûBANKERûSAID Etrading Software and the name
improve the archaic and If they decide to put in an Blackstone declined to address of the initiative. Etrading
INEFlCIENTûPROCESSûFORûSELLINGûANDû order for the bonds, investors the concerns about its ownership Software also declined to
distributing new issues. respond separately to each of the of Ipreo. In a statement provided comment.
/NEûPLATFORMûRUNûBYûlNANCIALû banks running the trade in a TOû)&2ûITSûSENIORûMANAGINGû “The platform was born out
software provider Ipreo, is thriving multi-dimensional ping-pong director Martin Brand said Ipreo’s OFûSIGNIlCANTûFEEDBACKûTHATûEACHû
in Europe. But reticence to work that continues until investors Investor Access has garnered of us had received from the
with rivals and power struggles receive their allocations and the hSIGNIlCANTûPARTICIPATIONvûWITHINû buyside at various points in
HAVEûSOûFARûSTImEDûCHANGEûINûTHEû53 deal is priced. the market. TIMEvû0ETERû!HERNEûHEADûOFû
Faced with the prospect of Until the very end, the system Sources familiar with the North America capital markets,
inevitable disruption, three of is frustratingly error-prone. MATTERûTOLDû)&2ûTHATû)PREOûISûSTILLû syndicate and new products at
the largest US banks - Bank of “The number of times two planning to launch Investor #ITIûTOLDû)&2
America Merrill Lynch, banks have given us two Access into the US later this Over the past few months,
Citigroup and JP Morgan - are different allocations - I would say year. BNP Paribas, Deutsche Bank,
giving the idea another go. ITSûAûDOZENûTIMESûEVERYûYEARvû But it remains to be seen Goldman Sachs and Wells Fargo
one portfolio manager said. whether the product could gain HAVEûALLûJOINEDûTHEûINITIATIVEû
GETTING THE MESSAGE meaningful traction now that They all declined to comment
!TûlRSTûSIGHTûTHEûNEWûPLATFORMû MISSION CREEP top US banks are pursuing their for this story.
the three banks are working on The most successful attempt to own initiative. A number of other banks with
seems little more than a simple shake things around has so far AûMAJORûPRESENCEûINûTHEûMARKETû
messaging system. come from Europe, where at the PROJECT MARS however, have felt the process
Expected to launch later this start of 2017 Ipreo and 11 Even in Europe, some bankers has left them out in the cold.
year or early in 2019, it would partnering banks launched have complaints with Ipreo as "ANKERSûFROMûlRMSûINCLUDINGû
allow banks to communicate Investor Access. the sole vendor in the market, Morgan Stanley, MUFG, UBS and
terms of new bond issues to In less than two years, the CITINGûHIGHûFEESûANDûJAMSûONû HSBC said as recently as a
investors and collect orders in a service has brought on board 37 busy deal days. month ago that they had yet to
centralised fashion. banks and 236 investors. Last They argue that a consortium BEûINVITEDûTOûJOINûTHEûGROUP
Bankers and investors year, 90% of euro and sterling- model where all banks invest “We’ve been kept in the dark
generally agree the current set up denominated bond deals were into the development of a and a lot of other banks have -
- which relies on a hodgepodge of syndicated using Investor Access. platform might be preferable to WITHûWHATEVERûTHEYREûDOINGvû
Excel spreadsheets, phone calls Goldman Sachs - whose relying on a third-party one of the bankers said.
and emails - is due for a drastic merchant banking division provider. BAML’s Karp said the platform
make over. partnered with private equity About two years ago, for will be open to any and all
h4HEREûAREûINEFlCIENCIESûINû giant Blackstone in 2014 to example, Swiss bank UBS banks who want to use it.
the current process for all acquire Ipreo - is the only US bank assigned an internal team to “Our focus is improving
PARTIESvû!NDREWû+ARPûHEADûOFû that took part in the initiative. study the creation of a utility- WORKmOWûANDûSOLVINGû
global investment-grade capital Bankers say Ipreo’s type platform for new issues communication issues between
markets at Bank of America ownership was one of the main with diffused ownership, a banks and investors by creating
-ERRILLû,YNCHûTOLDû)&2 reasons that discouraged other person familiar with the matter an inclusive platform for the
!GREEINGûONûAûlXûHOWEVERû 53ûBANKSûTOûJOINû)NVESTORû!CCESS TOLDû)&2 BENElTûOFûTHEûINDUSTRYûAVAILABLEû
has proved challenging. “There was a concern of mission UBS discussed the initiative, TOûALLûWHOûWISHûTOûUSEûITvûHEû
The same three banks leading CREEPûFROMû)PREOvûONEû,ONDON
KNOWNûASû0ROJECTû-ARSûWITHû TOLDû)&2
the latest effort, for example, BASEDûSYNDICATEûBANKERûTOLDû)&2 %TRADINGû3OFTWAREûAû5+ûlNANCIALû A source familiar with the
have refused to sign up to Ipreo’s “There was a fear that TECHNOLOGYûlRMûTHATûHADûALREADYû platform declined to comment
Investor Access, an existing Blackstone and Goldman would rolled out a system that on its potential fee structure but
solution that has been widely try and displace the current facilitates secondary trading said that the seven initial
successful in Europe but was - syndication model with a called Neptune, the same person members will not have a
until recently - partly owned by product distribution model and another source familiar with competitive advantage over
rival Goldman Sachs. where they would try and the discussions said. BANKSûWHOûMIGHTûJOINûLATER
12
&
Royal Bank
of Canada
Markets
13 HSBC
dealmaker 17 Tesla
US$72bn
beats expectations Philip Noblet and two tentative take-private
thanks to strong colleagues become brings out flock of
performance in latest recruits for investment bankers
capital markets Jefferies seeking mandates
Floating-rate notes in a fix
Issuers need to confront post Libor risk
Legal advisers to a Bank of England working LIABILITYûMANAGEMENTûEXERCISESûFORûALLûBONDû create a disincentive to the parties’
group have warned that over £312bn of issues affected. proposing or agreeing to any changes to the
OUTSTANDINGûSTERLING
DENOMINATEDûmOATING
RATEû 3UCHûEXERCISESûCOULDûPROPOSEûTOûBONDHOLDERSû terms of the bonds. Therefore there is no
notes that are due to mature after 2021 could that references to Libor should be changed to guarantee that any proposed amendments
EFFECTIVELYûBECOMEûlXEDûIFûNOTHINGûISûDONEûTOû the recommended replacement Sonia, for will be accepted,” said the paper.
address their references to Libor. instance. But that could be an immensely "ANKSûWHOûSELLûmOATING
RATEûNOTESûTOûISSUERSû
The widely used benchmark is being complicated task, with over 775 individual could also be potentially sued if the bonds no
phased out and will no longer be calculated issues according to Thomson Reuters data. longer hedge the issuers against rates as was
from the beginning of 2022. That means “With the derivatives market it is easier to promised, because Libor is no longer calculated.
potentially all notes referring to Libor may confront these issues, because the protocol h)FûAûSWITCHûFROMûmOATINGûTOûlXEDûRATEû
be stuck at the last rate at which it was that the market uses could simply be results in a loss to investors, this could
calculated, December 31 2021. changed from Libor to Sonia, but with bonds EXPOSEûTHEûISSUERûANDûARRANGINGûBANKS ûTOû
h4HEûMAJORITYûOFûmOATING
RATEûBONDSûALSOû it is not so simple a process,” said one legal litigation risk,” said the paper. “There could
provide that, as an ultimate fallback…then the source. “It will not be quick nor easy.” be a risk that an investor might claim that it
rate defaults to the most recently calculated !NDREWû"AILEYûCHIEFûEXECUTIVEûOFûTHEû&INANCIALû has been mis-sold the product.”
rate, for an earlier interest period,” said a Conduct Authority, said in a speech last year that A second legal source said: “The best way
recent paper by the working group. banks and other major users of the sterling would be to transition to an alternative
h)NûTHEûCONTEXTûOFûAûPERMANENTû mOATING
RATEûBONDûMARKETSûNEEDEDûTOûBEûAWAREû benchmark well ahead of the end of 2021. In
discontinuation of Libor, this would that Libor would not be used after 2021. the meantime bond prospectuses should
EFFECTIVELYûRESULTûINûTHEûmOATING
RATEûBONDSû Last month Bailey said neither should include risk warnings regarding the switch
BECOMINGûlXEDûRATEûBONDSûBECAUSEûTHEûLASTû issuers rely on a “synthetic” version of Libor from Libor.”
determined rate would be applied for the to assist them with the problem. The source said there could potentially be a
remainder of the life of the bond.” He said: “The biggest obstacle to a smooth way to make the transition for outstanding
Thomson Reuters data shows that at transition is inertia – a hope that Libor will long-maturity notes without needing to carry
PRESENTûOVERûaBNûmOATING
RATEûNOTESûINû continue, or that work on transition can be OUTûFULLûSCALEûLIABILITYûMANAGEMENTûEXERCISESûASû
sterling with maturities beyond 2021 are in DELAYEDûORûIGNOREDû-ISPLACEDûCONlDENCEûISûAû WELLûBUTûTHISûNEEDEDûTOûBEûCLARIlED
issue and could be affected by this situation. RISKûTOûlNANCIALûSTABILITYûASûWELLûASûTOûINDIVIDUALû Christopher Spink
The largest issuers are LLOYDS BANKING GROUP lRMSv
and SANTANDER, both of which have large The legal source agreed. “Issuers need to STERLING FRNs OUTSTANDING AS OF 23/08/2018
mOATING
RATEûMORTGAGEûBOOKS move away before then. As fewer banks Issuer Proceeds (£m) Issues
Lloyds, together with its subsidiary HBOS, submit rates, Libor will increasingly become Lloyds Banking Group 16,499.7 23
have around £30bn outstanding and in reality the rate at which other banks will Banco Santander 13,647.0 24
Santander has £19bn of such bonds (see not lend to each other as it will be based on HBOS 13,610.8 18
table). It is assumed that the majority of very few interbank transactions.” Barclays 11,761.0 15
these notes are linked to Libor, by far the The working group’s paper also highlighted Investec Holdings 8,565.7 24
most commonly used sterling benchmark. that issuers could face litigation risks from UK Asset Resolution 8,431.0 3
investors who might prefer to stick with Libor General Motors 7,236.8 22
LIABILITY MANAGEMENT ATûITSûLASTûhlXEDvûPRICEûRATHERûTHANûMOVEûITûTOûAû Royal Bank of Scotland Group 6,888.6 11
In the paper, the working group, which was new benchmark that is less economically Porsche Automobil Holding 6,773.5 10
formed by the Bank of England but does not advantageous for them. Lehman Brothers Holdings 6,201.6 20
REmECTûITSûVIEWSûSAIDûTHEREûWEREûWAYSûTOû “Depending on the prevalent interest rate Industry total 312,421.2 775
mitigate this risk by potentially carrying out ENVIRONMENTûTHEûSWITCHûTOûAûlXEDûRATEûMAYû Source: Thomson Reuters
BARCLAYS has Stecher, chief innovation Chris Munro is moving finance alongside
appointed Justin officer, and work closely back to New York after Sarang Gadkari, who
Brickwood to a new with Nas Al-Khudairi, becoming sole global was made co-head of
position as head of global head of electronic head of leveraged global capital markets
markets innovation from equities and co-head of finance at BANK OF in May. Munro joined
September. He joins from cash equities, as well as AMERICA MERRILL BAML as co-head of
Goldman Sachs, where Asita Anche, head of LYNCH earlier this year. leveraged finance
he was worked for 23 markets quantitative He will be based in New EMEA after nearly 20
years and was most eTrading and data York from September, years at JP Morgan in
recently head of EMEA science and another banking sources 2015. Joe Bishay is now
equities electronic former Goldman banker confirmed. Munro was head of European
trading engineering. He Brett Tejpaul, head of previously global co- leveraged finance at
will report to John digital and client strategy. head of leveraged BAML.
Hei Man Leung, a Wendy Mok has MORGAN STANLEY Ashish Sharma has Beryl Bai has joined AMP, Australia’s
former loans banker joined CHINA has appointed Alex started work in HSBC’s SHANGHAI PUDONG biggest listed wealth
with China Minsheng EVERBRIGHT BANK Abagian as co-head of Asia Pacific leveraged DEVELOPMENT manager, has named
Banking Corp Hong Hong Kong branch as equity capital markets and acquisition finance BANK Hong Kong Credit Suisse veteran
Kong branch, has joined a vice president in the for Asia-Pacific, loan syndication team. branch as a senior Francesco De Ferrari its
financial services group syndicated finance alongside Mille Cheng. He reports to Phil Lipton, associate in the loan new CEO. AMP’s
FORTUNE FOUNTAIN team. She reports to Hong Kong-based head of loan syndication syndication team. She former CEO, Craig
CAPITAL. Leung has Ka-ming Mak, who Abagian will continue for Asia Pacific, and will reports to Yorkie Wong, Meller, stepped down
responsibility for debt joined as general to head equity work closely with James general manager of in April following
and equity capital manager of structured syndication for Asia- Horsburgh, head of the structured revelations of the firm’s
market fundraising. He finance at the Chinese Pacific in addition to leveraged and products department. misconduct during
will report to Foster Lee. bank last month. his new acquisition finance for She joins from Wing Australia’s Royal
responsibilities. Asia Pacific. Lung Bank. Commission enquiry.
Global raters outline China plans robust and transparent criteria, processes and
methodology,” the agency said.
Two of the world’s biggest credit rating reached. Therefore we believe that localised
agencies have outlined contrasting plans for RATINGûMETHODOLOGYûlTSûTHEûDOMESTICûMARKETû LOCAL HURDLES
their onshore China businesses as they seek BESTvûSAIDû30ûINûTHEû#HINESE
LANGUAGEûlLING Market participants said S&P’s localised
long-elusive licences in the world’s third- h4HEREûISûNOûDElNEDûMAPPINGûRELATIONSHIPû approach might be more practical given the
biggest bond market. between the ratings we assign [in China] and regulatory landscape in China.
Moody’s and S&P have recently published those S&P Global Ratings assigns based on One industry source at a Chinese rating
detailed applications for rating licences in its global rating system,” said S&P. agency pointed out that it was hard to
China’s interbank bond market. The two rating agencies declined to challenge the current regulatory
"OTHûlRMSûSETûUPûWHOLLYûOWNEDûCREDITûRATINGû comment on their onshore rating framework, under which every public bond
UNITSûINû"EIJINGûINû*UNEûlLINGSûSHOWûANDûAREû METHODOLOGIESûWHENûCONTACTEDûBYû)&2û30û offering must have at least one domestic
applying for licences to rate all categories of debt referred to an earlier statement that it rating in order to win regulatory approvals.
instruments in the interbank bond market, would build its local operation “organically”, “If Moody’s applies a global rating
INCLUDINGûlNANCIALûANDûNON
lNANCIALûNOTESû WHILEû-OODYSûSAIDûITûWASûhEXPLORINGûWAYSûTOû methodology, that suggests it will produce
Panda bonds and asset-backed securities. better serve our customers and contribute to global ratings for onshore bonds rather than
The proposed strategies, however, are the development of the Chinese market”. a domestic rating based on the PBoC scale,”
very different. The applications to the National Association said the source.
Moody’s (China) Credit Rating plans to use OFû&INANCIALû-ARKETû)NSTITUTIONALû)NVESTORSû “As such, it will present a big question to
its parent company’s rating methodology, come about one year after the People’s Bank regulators whether they will allow a global
RATINGûSYMBOLSûANDûDElNITIONSû30û of China published formal guidelines allowing rating as a reference for bond approvals. This is
meanwhile, said its standalone business in foreign rating agencies to provide credit something regulators have not addressed yet.”
China would apply a customised rating OPINIONSûONSHOREûFORûTHEûlRSTûTIME Moody’s rates China A1 on its global scale,
system and methodology, although it said it &ITCHûhISûINûTHEûPROCESSûOFûAPPLYINGûFORûAû implying that even the top domestic issuers
would use its global methodology as a licence from Chinese regulators to operate will be limited to a high Single A rating. In
reference when conducting rating analysis. independently in the country”, it said in an China’s domestic bond market, it is
“China should have an independent rating EMAILûTOû)&2 generally accepted that issuers need at least
system, which develops along with its h&ITCHSûAPPROACHûISûTOûENSUREûTHATûWEûWORKû a Double A grade to attract investors to a
domestic capital market, given the to our own standards consistent with public offering.
development stage the capital market has international best practice, and with rigorous, Ina Zhou
13/8/18
14/8/18
15/8/18
16/8/18
20/8/18
21/8/18
22/8/18
23/8/18
area, although the spread was revised The deal is KommuneKredit’s second euro
TIGHTERûTOûAûlNALûLESSûBPûAFTERûORDERSû OUTINGûATûTHISûPARTûOFûTHEûCURVEûINûû4HEû
PASSEDûõM previous issue in March attracted over
3
NUMBER OF GERMAN BANKS TAKING
While recent euro issuance has been at
best sporadic, the traditional post-summer
PICK
UPûISûEXPECTEDûTHISûWEEKû4HEûEUROPEAN
õBNûOFûDEMANDû)TûCAMEûATûBPûTHROUGHû
SWAPSûANDûWASûQUOTEDûATûBPûTHROUGHûONû
7EDNESDAYûACCORDINGûTOû4RADEWEBûPRICES
ADVANTAGE OF NEW LEGISLATION TO STABILITY MECHANISM will be among the BNP Paribas, LBBW and Societe Generale were
ISSUE SENIOR PREFERRED DEBT IN THE CROWDSûHAVINGûSENTûANû2&0 JOINTûLEADûMANAGERS
PUBLIC MARKET "ANKERSûSAIDû%3-ûCOULDûCOVERûTHEûENTIRETYû
OFûITSûREMAININGûõBNûFUNDINGûNEEDSûFORûTHEû ALL US DOLLAR FIXED-RATE GLOBALS
QUARTERûEITHERûVIAûAûSINGLEûISSUEûORûAûõBNû BOOKRUNNERS: 1/1/2018 TO DATE
BONDûCOMBINEDûWITHûAûTAP Managing No of Total Share
bank or group issues US$(m) (%)
€4.7bn
SIZE OF THE ORDER BOOK FOR
h7EûMADEûTWOûSUGGESTIONSûTHEûlRSTûONEû
BEINGûAûNEWû
YEARûBONDûCOMBINEDûWITHûAû
LONGER
DATEDûTAPûOFûPERHAPSû
YEARSûORûAû
1 BAML
2 JP Morgan
137
136
52,521.05 11.7
49,299.39 11.0
RABOBANK’S DEBUT NON-PREFERRED NEWûLINEûOFûEITHERûûORû
YEARSvûSAIDûAû 3 Citigroup 119 42,573.88 9.5
SENIOR BOND, A €1bn FIVE-YEAR BANKER 4 Barclays 81 40,680.44 9.1
4HEû%3-û!A.2!!!ûLASTûVISITEDûTHEû 5 Goldman Sachs 81 33,253.75 7.4
MARKETûINû*ULYûSELLINGûAûõBNûlVE
YEARûONû 6 Wells Fargo 86 27,628.30 6.2
OVERûõBNûOFûDEMANDû)TûWASûBIDûATûBPû 7 Morgan Stanley 79 24,501.30 5.5
11bp
FALL IN YIELD ON ITALY’S 10-YEAR BTP
through mid-swaps on Thursday, 2bp
THROUGHûREOFFER
h3EVEN
YEARSûMIGHTûBEûTOOûCLOSEûTOûlVE
8 Deutsche Bank
9 HSBC
10 RBC
51
45
58
23,530.98 5.2
22,249.99 5.0
20,604.28 4.6
AS MOODY’S ANNOUNCED AN EXTENSION YEARSûWHICHûTHEYVEûJUSTûDONEvûAûSECONDû Total 275 448,258.93
TO THE DEADLINE FOR ITS REVIEW OF THE BANKERûSAIDûh4HEYVEûNOTûDONEûAû
YEARûSINCEû Excluding equity-related debt, ABS/MBS.
COUNTRY’S RATING last year but it might make sense for them to Source: Thomson Reuters SDC code: O5
LOOKûATûAûMATURITYûFURTHERûOUTvûHEûSAID
10yr BTP yield on August 21
3.06
ALL BONDS IN EUROS ALL INTERNATIONAL BONDS (ALL CURRENCIES)
3.04 BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
3.02 Managing No of Total Share Managing No of Total Share
bank or group issues €(m) (%) bank or group issues US$(m) (%)
3.00
1 BNP Paribas 235 56,183.02 7.3 1 JP Morgan 694 189,209.34 7.5
2.98
2 Deutsche Bank 214 46,835.59 6.1 2 Citigroup 659 175,934.64 7.0
2.96 3 SG 192 45,878.45 6.0 3 Barclays 501 153,821.29 6.1
2.94
4 HSBC 225 44,086.23 5.7 4 HSBC 639 149,102.54 5.9
Open High Low Close 5 Credit Agricole 178 43,588.84 5.7 5 BAML 541 142,849.98 5.6
6 JP Morgan 165 40,706.09 5.3 6 Goldman Sachs 399 130,266.67 5.2
7 Barclays 144 38,424.28 5.0 7 Deutsche Bank 515 124,680.78 4.9
8 UniCredit 194 37,301.24 4.9 8 BNP Paribas 423 101,919.96 4.0
€188m
THE AMOUNT THE ECB BOUGHT
9 Citigroup
10 Goldman Sachs
Total
134
106
1,118
32,704.68 4.3
32,349.27 4.2
767,846.84
9 Morgan Stanley
10 Credit Suisse
Total
405
372
3,783
101,442.93 4.0
71,426.05 2.8
2,528,847.68
THROUGH ITS CSPP IN TRADES SETTLED Including Euro-preferreds. Excluding equity-related debt, Including Euro, foreign, global issues. Excluding equity-related debt,
US Global ABS/MBS. US Global ABS/MBS.
IN THE WEEK UP TO AUGUST 17
In total, it has bought €165.891bn Source: Thomson Reuters SDC code: N1 Source: Thomson Reuters SDC code: J1
BERLIN BLOW OUT WAITING FOR DOLLARS The Federal State of SCHLESWIG-HOLSTEIN
The warm reception given by investors to The ESM could also decide not to raise its JOINEDûTHEûEUROûTEAMûOFûISSUERSûPRINTINGûAû
BERLINSûõMû
YEARûLASTûWEEKûCOULDû full Q3 target and leave something for the õMûNO
GROWû
YEARûONû&RIDAYû,EADSû
ENCOURAGEû%3-ûTOûLOOKûFURTHERûTHANûTHEû
53ûDOLLARûMARKET Commerzbank, DZ Bank, HSBC, LBBW and Nord/
YEARûMARK It has committed to raise funds in dollars LBûPRICEDûATûBPûTHROUGHûMID
SWAPSûINûLINEû
4HEû'ERMANûSTATEûATTRACTEDûOVERûõBNû aside from its usual euro transactions but WITHûLESSûBPûAREAûGUIDANCEûALTHOUGHû
of orders and priced 2bp inside initial talk, HASûYETûTOûAPPEARûINûTHEûCURRENCYûTHISûYEAR THEREûWEREûNOûBOOKûUPDATESûRELEASED
ATûBPûTHROUGHûSWAPSû)TûHASûSINCEûHELDûINû )TSûINAUGURALûDEALûAû53BNûlVE
YEARûSOLDû 3CHLESWIG
(OLSTEINûLASTûCAMEûTOûTHEûPUBLICû
BIDûATûLESSûBPûONû4RADEWEB LASTû/CTOBERûWASûQUOTEDûATûBPûOVERûSWAPSû MARKETûINû-AYûBRINGINGûAûõMûlVE
YEARû
“There are some parts of the investor BPûTIGHTERûTHANûWHEREûITûPRICED DEALûATûLESSûBP
COMMUNITYûTHATûAREûCONSTRAINEDûTOûlNDû (OWEVERûBANKERSûDOûNOTûSEEûAûWINDOWû 4HEûLATESTûINSTITUTIONûTOûJOINûTHEûEUROûFRAYû
longer-dated assets, they have to invest in OPENûFORûDOLLARSûGIVENûTHEûCURRENTûCONDITIONS is AGENCE FRANCAISE DE DEVELOPPEMENTû4HEû
something long-dated,” the second banker “They have indeed made the commitment Double A rated issuer is planning a
SAID to issue in dollars before the end of the year, roadshow for a Climate bond, commencing
“So, a transaction with a bit more but the basis has moved so much that it has ONû3EPTEMBERûûTHATûWOULDûLASTûFORûATûLEASTû
CONCESSIONûTHANû"ERLINûWOULDûWORKûWELLû BECOMEûEXPENSIVEvûSAIDûAûFOURTHûBANKER TWOûDAYSûACCORDINGûTOûAûLEAD
While the investor base for longer-dated 4HEûlVE
YEARûEURO53ûDOLLARûBASISûSWAPû !&$ûLASTûISSUEDûAû'REENû#LIMATEûBONDûINû
deals is relatively small, they can buy in has been shifting less negative for most of .OVEMBERûûVIAûCredit Agricole, HSBC,
large sizes, and if you can unearth interest ûANDûWASûQUOTEDûATûLESSûBPûONû Natixis and Societe Generaleû4HEûõMûû
from them, it can be a deciding factor for Thursday, from less 36bp at the beginning .OVEMBERûûPRICEDûATû/!4SûPLUSûBPû
THEûSUCCESSûOFûAûDEALv OFûTHEûYEAR The same four leads are involved this time
around, with the addition of BNP Paribas
ALL INTERNATIONAL US$ BONDS ALL SOVEREIGN BONDS IN EUROS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE ITALY CATCHES SHORT-LIVED BID AFTER
Managing No of Total Share Managing No of Total Share RATING REVIEW EXTENSION
bank or group issues US$(m) (%) bank or group issues €(m) (%)
1 JP Morgan 470 131,694.98 9.7 1 Barclays 15 11,552.98 12.0 Moody’s announcement that it would
2 Citigroup 476 129,197.26 9.5 2 Citigroup 16 9,560.05 9.9 extend ITALYSû"AAûRATINGûREVIEWûFORû
3 BAML 396 105,981.36 7.8 3 JP Morgan 13 9,541.35 9.9 downgrade until the end of October gave the
4 Barclays 290 94,715.01 7.0 4 BNP Paribas 12 7,660.47 7.9 GOVERNMENTûDEBTûAûlLLIPûLASTûWEEKûTHOUGHû
5 Goldman Sachs 275 85,909.12 6.3 5 HSBC 11 7,339.59 7.6 the rally proved to be short-lived as volatility
6 HSBC 271 71,790.26 5.3 6 NatWest Markets 6 6,826.39 7.1 CAUGHTûUPûWITHûTHEûSOVEREIGN
7 Morgan Stanley 264 71,427.92 5.3 7 SG 11 5,984.29 6.2 The ratings agency’s decision to wait for
8 Wells Fargo 255 63,482.56 4.7 8 Santander Global 5 4,589.15 4.8 GREATERûCLARITYûONûTHEûGOVERNMENTSûlSCALû
9 Deutsche Bank 252 60,387.16 4.5 9 BBVA 3 3,813.65 4.0 path and reform agenda sent yields lower
10 Credit Suisse 249 49,126.77 3.6 10 Goldman Sachs 7 3,723.50 3.9 LASTû4UESDAY
Total 1,629 1,353,626.17 Total 34 96,391.70 4HEû
YEARû"40ûTHATûWASûBIDûATûûATû
Including Euro, foreign and global issues. Excluding equity-related debt, Excluding ABS/MBS. THEûOPENûDROPPEDûTOûûWHILEûTHEûSPREADû
US Global ABS/MBS.
AGAINSTû'ERMANYûTIGHTENEDûBYûBPûTOû
Source: Thomson Reuters SDC code: O1 Source: Thomson Reuters SDC code: N4 BPûACCORDINGûTOû4RADEWEBûPRICES
ALL AGENCY BONDS IN EUROS ALL SUPRANATIONAL BONDS IN EUROS MUNICIPAL, CITY, STATE, PROVINCE ISSUES IN EUROS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues €(m) (%) bank or group issues €(m) (%) bank or group issues €(m) (%)
1 Credit Agricole 18 6,288.80 8.7 1 Credit Agricole 18 6,255.84 9.9 1 UniCredit 31 4,748.13 14.5
2 Goldman Sachs 12 6,238.70 8.7 2 UniCredit 9 5,231.32 8.3 2 DGZ-DekaBank 25 3,416.61 10.5
3 JP Morgan 17 6,106.07 8.5 3 Commerzbank 11 5,180.45 8.2 3 HSBC 20 3,227.37 9.9
4 Commerzbank 19 5,647.22 7.8 4 Barclays 8 5,099.94 8.0 4 LBBW 23 2,726.80 8.3
5 HSBC 21 5,140.58 7.1 5 SG 8 4,176.26 6.6 5 Deutsche Bank 17 2,127.49 6.5
6 Deutsche Bank 14 4,452.45 6.2 6 HSBC 13 4,123.10 6.5 6 JP Morgan 12 2,026.97 6.2
7 BNP Paribas 13 4,304.21 6.0 7 Deutsche Bank 11 4,067.59 6.4 7 Nord/LB 18 1,902.22 5.8
8 SG 18 4,280.63 5.9 8 JP Morgan 8 3,775.22 6.0 8 Credit Agricole 6 1,233.27 3.8
9 UniCredit 9 3,784.17 5.3 9 DZ Bank 9 3,509.88 5.5 9 DZ Bank 13 1,145.93 3.5
10 LBBW 10 2,953.85 4.1 10 Goldman Sachs 6 3,120.03 4.9 10 BBVA 5 950.36 2.9
Total 114 71,993.80 Total 58 63,371.71 Total 91 32,662.15
Excluding equity-related debt. Including publicly owned institutions. Excluding ABS/MBS. Excluding ABS/MBS.
Source: Thomson Reuters SDC code: N6 Source: Thomson Reuters SDC code: N5 Source: Thomson Reuters SDC code: N7
ALL INV-GRADE US CORPORATE BONDS ALL US INVESTMENT GRADE CORPORATE DEBT ALL CORPORATE BONDS IN EUROS
BOOKRUNNERS: 1/1/2018 TO DATE (EXCLUDING SOLE SELF FUNDED DEALS) BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share BOOKRUNNERS: 1/1/2018 TO DATE Managing No of Total Share
bank or group issues US$(m) (%) Managing No of Total Share bank or group issues €(m) (%)
1 BAML 57 10,084.73 10.7 bank or group issues US$(m) (%) 1 BNP Paribas 108 18,361.91 8.7
2 JP Morgan 52 8,279.56 8.8 1 JP Morgan 279 78,848.53 11.0 2 Deutsche Bank 84 16,377.16 7.8
3 Morgan Stanley 35 6,860.03 7.3 2 BAML 255 77,808.33 10.8 3 SG 81 14,992.11 7.1
4 Wells Fargo 48 6,811.61 7.2 3 Citigroup 239 66,497.70 9.3 4 HSBC 80 11,455.42 5.4
5 Citigroup 38 6,522.08 6.9 4 Goldman Sachs 160 56,166.56 7.8 5 Goldman Sachs 45 11,399.25 5.4
6 Mizuho 28 4,944.18 5.3 5 Morgan Stanley 204 51,154.34 7.1 6 JP Morgan 74 11,391.00 5.4
7 Barclays 31 4,768.71 5.1 6 Barclays 132 47,377.84 6.6 7 Credit Agricole 65 11,264.95 5.3
8 Goldman Sachs 23 4,577.64 4.9 7 Wells Fargo 178 43,717.71 6.1 8 UniCredit 62 10,980.56 5.2
9 MUFG 24 3,979.75 4.2 8 RBC 108 27,765.36 3.9 9 ING 51 9,412.46 4.5
10 RBC 25 3,274.96 3.5 9 HSBC 83 27,001.06 3.8 10 Barclays 51 8,923.59 4.2
Total 145 94,094.12 10 Deutsche Bank 84 23,251.12 3.2 Total 321 210,624.31
Excluding equity-related debt, ABS/MBS, all foreign issues, global issues Total 649 718,175.23 Excluding equity-related debt. FIGs, ABS/MBS.
and non corporates.
Source: Thomson Reuters SDC code: F6a Source: Thomson Reuters SDC code: F09a Source: Thomson Reuters SDC code: N8
PLUSûBPûLASTû4HURSDAYûFROMûBPûONû Source: Thomson Reuters SDC code: N9 Source: Thomson Reuters SDC code: N8a
!UGUSTû
Active bookrunners were Citigroup, ALL INTERNATIONAL STERLING BONDS ALL SWISS FRANC BONDS EXCLUDING
Deutsche Bankû"$ ûNordea and OP Corporate EXCLUDING SECURITISATIONS SECURITISATIONS
Bank BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share
ELIA TO RESURFACE FOLLOWING UNIT bank or group issues £(m) (%) bank or group issues SFr(m) (%)
STAKE SALE TO KFW 1 HSBC 69 10,884.90 13.9 1 UBS 82 9,783.75 28.5
2 NatWest Markets 63 9,432.26 12.1 2 Credit Suisse 85 9,445.79 27.5
ELIA SYSTEM OPERATOR is gearing up for a dual- 3 Barclays 57 7,545.17 9.7 3 Verband Schweizerischer 9 3,788.82 11.0
tranche deal, reviving the long-awaited 4 RBC 46 6,290.84 8.1 4 ZKB 37 3,719.94 10.8
TRADEûAFTERûCOMPLETINGûTHEûSALEûOFûAûû 5 Lloyds Bank 35 5,126.27 6.6 5 Raiffeisen Schweiz 25 2,173.30 6.3
STAKEûINû'ERMANYSû%UROGRIDûTOû+F7 6 BAML 24 3,814.29 4.9 6 BNP Paribas 14 1,387.35 4.0
4HEû"ELGIANûPOWERûTRANSMISSIONûCOMPANYû 7 Goldman Sachs 12 3,329.33 4.3 7 Deutsche Bank 9 955.33 2.8
lRSTûANNOUNCEDûTHEûõMûPERPETUALûANDû 8 Santander Global 17 3,309.28 4.2 8 Commerzbank 9 749.25 2.2
õMûSENIORûMANDATEûINûMID
-AYû 9 JP Morgan 16 3,299.77 4.2 9 HSBC 7 735.63 2.1
EARMARKINGûPROCEEDSûTOûRElNANCEûAû 10 Nomura 26 3,206.24 4.1 10 Bank Vontobel 1 225.00 0.7
õMûBRIDGEûLOANûBACKINGûITSûACQUISITIONû Total 200 78,137.60 Total 160 34,381.70
OFûAûSEPARATEûûSTAKEûINû%UROGRIDûFROMû Including preferreds. Excluding equity-related debt. Including preferreds. Excluding equity-related debt.
!USTRALIASû)&-û'LOBALû)NFRASTRUCTUREû&UND Source: Thomson Reuters SDC code: K05a Source: Thomson Reuters SDC code: K06b
NATIONAL AUSTRALIA BANK (Aa3/AA–/AA–) The syndication manager suggested the Royal NAB raised €500m more than identically
made a successful return to the euro market Commission into banking practices and other rated Westpac for its two-piece trade on July
last Wednesday with a €2bn dual-tranche financial scandals was having little detrimental 9, €650m of 0.75% 5.25-years and €850m of
Eurobond issue that helped allay remaining impact on investor sentiment in primary 1.45% 10-year Eurobonds that were priced at
fears of a European investor push-back related markets. mid-swaps plus 50bp and 62bp, respectively.
to Australia’s banking scandals. “Investors have seen a lot of this before and Both Westpac and NAB were encouraged
A capped €750m five-year Green bond worse in other jurisdictions, while it can be to tap the euro market by this year’s shifts in
offering attracted an impressive €2.4bn of argued that the resultant increased regulations currency basis swaps. The five-year euro/US
demand, which enabled joint lead managers that have been and will be imposed on dollar cross-currency basis swap has improved
BNP Paribas, Citigroup, NAB and UBS to price Australian banks are credit positive,” he said. to negative 17bp versus negative 34bp at the
the 0.625% August 30 2023s well inside 50bp start of the year, while the 10-year basis swap
area initial price thoughts at mid-swaps plus RELATIVE VALUE has made a similar move, to negative 17bp from
35bp for a 5bp new issue concession. Relative-value investors were clearly attracted negative 35bp on January 1.
An additional 10-year standard issue secured by the pick-up NAB offered over its European The NAB five-year came basically flat to
€1.8bn of orders for an unusually large €1.25bn peers. where a new US dollar five-year would print
print. The 1.375% August 30 2028s were priced “They [Aussie majors] used to be quite tight while the 10-year came about 10bp–15bp tighter
at mid-swaps plus 53bp, versus 65bp area IPTs. but have widened out quite a bit this year. So than a US dollar 10-year, according to a DCM
“They got a good window, but I’d also say it’s you have Swedbank that came at 18bp but NAB banker.
the best Aussie trade I’ve done in three years,” printed at 35bp, in line with Commerzbank’s NAB’s strong result will encourage other
said a banker on the deal. senior preferred. That relative-value piece has Antipodean financials to access the euro market,
A syndication manager away from the shifted this year and that’s taken some guys off including WESTPAC NEW ZEALAND (A1/AA–/AA),
transaction concurred. He described the the sidelines,” said the banker on the trade. which held a European roadshow in late May
outcome as “fantastic”, noting the extremely “We were capped on the five-year but we and early June with BNP Paribas, HSBC and
strong interest for the five-year Green offering could have easily doubled the size. They also Westpac for a euro-denominated five to seven-
and one of the largest 10-year issues by an have a strong following within the insurance year note offering.
Aussie major in recent years. community because of their ratings.” John Weavers, Helene Durand, Alice Gledhill
The Australian market for socially responsible The bonds will fund loans that meet three of Core responsible investments include positive
investments moved up a gear last week with a the United Nations’ 17 sustainable development screening for sustainability investing, community
Sustainability bond offering from BANK AUSTRALIA goals (SDGs), to reduce inequality, to build safe finance and corporate engagement, and
that connected a debut issuer with a group of and sustainable cities and communities, and to negative screening away from tobacco, weapons
first-time buyers. restore and sustain terrestrial ecosystems. and gambling, among other things.
The Victoria-based mutual bank, rated Baa1/ Bank Australia, which has posted annual Bank Australia markets itself as a 100%
BBB (Moody’s/S&P), sold A$125m (US$92m) of growth rates of around 13% for lending assets and customer-owned bank with a pledge to support
three-year floating-rate notes last Monday after deposits in recent years, is looking to become a social and environmental causes and avoid
strong demand helped it beat both its size and regular/annual issuer in the bond market. lending to the fossil-fuel industry. It runs a
price targets. conservation reserve and has been carbon-
Notably, the deal attracted demand from TIGHT PRICING neutral since 2011.
investors that had not previously participated in This is only the second Sustainability bond “The strong demand and tight pricing
three-year FRN offerings from other Australian issue to hit the domestic market following levels achieved by Bank Australia can only
mutual banks. Australian Catholic University’s A$200m 3.7% encourage other issuers contemplating a
In particular, local councils and religious 10-year note offering in July 2017. Sustainability bond to come to market,” Gaydon
entities bought 14% and 6% of the bonds, ACU, rated Aa2 (Moody’s), priced its offering said.
respectively. around 5bp tighter than an equivalent standard MACQUARIE UNIVERSITY, rated Aa2 (Moody’s),
“The rare Sustainability bond offering university 10-year bond issue, according to is set to follow ACU with a debut Sustainability
attracted support from a diverse range of bankers at the time, who cited a sticky investor bond issue, after beginning Asian and Australian
investors who were keen to participate in an pool with fewer marginal investors than normal investor meetings on August 16 via HSBC and
issue originated by a bank which is viewed as pulling orders as guidance tightened. NAB.
socially aware in respect to their sustainable ACU’s offering was the first Australian dollar In the state government sector Triple A rated
lending activities,” said Adam Gaydon, senior unsecured Green, Social or Sustainability NEW SOUTH WALES TREASURY CORP plans to issue its
syndication manager at sole lead ANZ. bond issue to come with only a slight premium to first Sustainability bonds, expected in the second
Asset managers took 48%, banks 27% and standard levels, having benefited from the huge half of 2018, while other banks, universities
others 5%. Australian accounts were allotted expansion in demand for responsible investments and corporates are working towards inaugural
95% and offshore 5%. and a lack of suitable bond offerings. offerings.
First-time investors pushed the order book The recently released Responsible Investment Offshore, Australia and New Zealand
above A$250m, which enabled the note offering Benchmark Report 2018 showed responsible Banking Group (A3/AA–/AA–) printed €750m
to be enlarged from an indicative A$100m investments under management had grown to (US$868m) of five-year Sustainable Eurobond
minimum issue size and to be priced inside A$866bn, for a 55% share of all professionally sin February 2018 that created an alternative to
133bp area guidance at three-month BBSW plus managed assets in Australia, a 39% increase the major bank’s Green bond template.
130bp. from A$622bn in 2016. John Weavers
ALL GLOBAL AND EUROMARKET YEN BONDS ALL SAMURAI BONDS ALL INTERNATIONAL YEN BONDS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues ¥(m) (%) bank or group issues ¥(m) (%) bank or group issues ¥(m) (%)
1 Sumitomo Mitsui Finl 7 71,650.03 18.1 1 Sumitomo Mitsui Finl 31 309,241.67 21.7 1 Sumitomo Mitsui Finl 38 380,891.69 20.9
2 Nomura 10 60,233.33 15.2 2 Mizuho 35 278,228.33 19.6 2 Mizuho 45 333,661.69 18.3
3 Mizuho 10 55,433.36 14.0 3 Mitsubishi UFJ MS 34 267,095.00 18.8 3 Mitsubishi UFJ MS 37 283,761.67 15.6
4 Daiwa Securities 8 31,916.67 8.0 4 Daiwa Securities 30 222,686.67 15.7 4 Nomura 40 280,203.33 15.4
5 BAML 2 31,833.33 8.0 5 Nomura 30 219,970.00 15.5 5 Daiwa Securities 38 254,603.33 14.0
6 MUFG 2 29,833.33 7.5 6 Natixis 11 47,120.00 3.3 6 BAML 4 61,833.33 3.4
7 Goldman Sachs 2 18,000.00 4.5 7 BAML 2 30,000.00 2.1 7 Natixis 11 47,120.00 2.6
8 Mitsubishi UFJ MS 3 16,666.67 4.2 8 Citigroup 5 17,333.33 1.2 8 MUFG 2 29,833.33 1.6
9 HSBC 2 15,000.00 3.8 9 BNP Paribas 3 16,125.00 1.1 9 Citigroup 6 22,819.58 1.3
10 Barclays 4 11,650.00 2.9 10 Credit Agricole 4 14,500.00 1.0 10 Goldman Sachs 2 18,000.00 1.0
Total 31 396,610.30 Total 46 1,422,300.00 Total 77 1,818,910.30
Excluding equity-related debt. Including preferreds. Excluding equity-related debt. Including all Euro, foreign and global issues. Excluding equity-related
debt.
Source: Thomson Reuters SDC code: K10 Source: Thomson Reuters SDC code: K11
Source: Thomson Reuters SDC code: K12
TOûTHEûEXTENTûWHEREûITûJUSTûDOESNTûLOOKûASû Three days earlier, COMMERZBANK printed
attractive as it has done in the past,” said the its inaugural Australian dollar Tier 2 !USTRALIANûDOLLARûmOATING
RATEûNOTEûISSUE
lRSTûBANKER subordinated Reg S note issue, under the CUA previously sold local three-year
"ARCLAYSûISSUEDûaBN
EQUIVALENTûOFû-2%,û 'ERMANûBANKSû%-4.ûPROGRAMME mOATERSûINû-ARCHûûWITHûAû!MûDEALû
INûTHEûlRSTûHALFûALLûINûSENIORûFORMATû)TûHASû 4HEû!Mûû
YEARûBULLETûOFFERINGû PRICEDûBPûWIDEûOFûTHREE
MONTHû""37
GUIDEDûINVESTORSûTOWARDSûaBNûOFûISSUANCEû WITHûEXPECTEDûRATINGSûOFû"AA"""n""""""û
for the full year to meet its MREL -OODYS30&ITCH3COPE ûWASûPRICEDûATû
requirements, and allow for an MREL PARûINûLINEûWITHûûAREAûGUIDANCE
MANAGEMENTûBUFFER Commerzbank, Deutsche Bank, NAB and TD
The bank has issued one other euro senior SecuritiesûWEREûJOINTûLEADûMANAGERSûONûTHEû COVERED BONDS
OFFERINGûTHISûYEARûAûõBNûû*ANUARYû TRANSACTION
ûTHATûCLOSEDûATûSWAPSûPLUSûBPûONû /Nû!UGUSTûû'ERMANYSûBIGGESTûSTATE
4HURSDAYû)TûWIDENEDûBYûBPûONû&RIDAY backed Landesbank, LANDESBANK EUROS
2OYALû"ANKûOFû3COTLANDSûPAPERûALSOûTOOKûAû BADEN-WUERTTEMBERGûORû,""7ûTAPPEDûITSû
HITûnûFORûEXAMPLEûITSûõBNûOFûûûNON
û-AYûûû4IERûûBULLETû%UROBONDSû RUSH FOR SENIOR OVERSHADOWS
CALLûSû"AA"""n""" ûWIDENEDûMOREû FORû!MûATûAûYIELDûOFûû,""7Sû2EGû3û COVERED BONDS
THANûBPûONû&RIDAYûACCORDINGûTOû4RADEWEB subordinated Luxembourg-listed notes are
h)ûFEELûFORû;"ARCLAYS=vûSAIDûAûFOURTHûBANKERû RATEDû"AA"""û-OODYS&ITCH Covered bond issuance took a back seat last
h"UTûTHEYLLûLOOKûBACKûINûAûCOUPLEûOFûWEEKSû HSBC, LBBW, Standard Chartered and TD week as banks made the most of better
ANDûSAYû@WEVEûGOTûOURûFUNDINGv SecuritiesûWEREûJOINTûLEADûMANAGERSûFORûTHEû market conditions to raise senior debt ahead
TAPûHAVINGûALSOûARRANGEDûTHEûORIGINALûSALE of what many expect to be a volatile
,""7ûPREVIOUSLYûRAISEDû!MûFROMûAû 3EPTEMBER
NON-CORE CURRENCIES û
YEARûBULLETû4IERûû%UROBONDûISSUEûINû Covereds have been the go-to instrument
*UNEû FORûLARGEûPARTSûOFûûASûBANKSûLOOKEDûTOû
TIER 2 TRIO TEMPT AUSSIE YIELD- carry on funding against a tricky backdrop
HUNTERS CBA BUYS BACK A$1.2bn of trade wars, political uncertainty and end
OFû1%
Three international banks issued COMMONWEALTH BANK OF AUSTRALIA has (OWEVERûAûBETTERûTONEûTHISûWEEKûMEANTû
subordinated Australian dollar Eurobonds REPURCHASEDûMOREûTHANû!BNûOFûlVEû THATûONLYûlVEûISSUERSûPRINTEDûINûTHEûFORMATû
over a seven-day period, raising a combined short-term bond lines and may consider VERSUSûûINûSENIOR
!Mû53M ûFORûTHEIRû4IERûûFUNDINGû further buyback opportunities through “Covered bonds are not necessarily the
REQUIREMENTS open-market purchases or other means, primary focus right now,” a syndicate
The banks were looking to access mainly THOUGHûNOTûOFûTHEû/CTOBERûûBONDûISSUEû BANKERûSAID
Asian demand for Australian dollar paper WHICHûISûAPPROACHINGûMATURITY “A lot of issuers are well ahead of where
YIELDINGûAROUNDûnûACCORDINGûTOûAû 4HUSûFARû#"!ûHASûREPURCHASEDû!Mû they thought they would be given that it’s
3YDNEY
BASEDû$#-ûMANAGER !Mû!Mû!MûANDû been the favoured asset class when the
Such transactions tend to increase in !MûOFûTHEû!BNû/CTOBERûSû market has taken a turn, most of them are
!UGUSTûWHENûMAJORûNORTHERNûHEMISPHEREû !BNû!PRILûSû!BNû*ULYûSû OVERWEIGHTûCOVEREDSv
markets are quiet for the US and European !BNû/CTOBERûSûANDû!BNû*ULYû "EFOREûTHEûPICK
UPûINûSENIORûISSUANCEûTHISû
SUMMERûHOLIDAYS SûRESPECTIVELY week, covered bond volumes were running
Last Thursday, South Korea’s SHINHAN BANK AHEADûOFûSENIORûATûJUSTûOVERûõBNûAGAINSTû
SOLDûAû!Mûû
YEARûBULLETû4IERûû2EGû3û CUA MARKETS THREE-YEAR FRNS õBNûALTHOUGHûSENIORûISûNOWûAHEADûATû
note issue, which was priced at par through ALMOSTûõBNûVERSUSûõBN
JOINTûLEADûMANAGERSûANZ and BNP Paribas CREDIT UNION AUSTRALIAûRATEDû"AA"""û EIKA BOLIGKREDITT and AAREAL BANK restarted
The subordinated offering has expected -OODYS30 ûHASûMANDATEDûANZ, CBA and ISSUANCEûAFTERûAûHIATUSûOFûJUSTûOVERûAûMONTHû
RATINGSûOFû"AA"""û-OODYS30 ûVERSUSû NAB to arrange investor meetings in Sydney with the decision to go early in the week
3HINHANSûSENIORûRATINGSûOFû!A! and Melbourne this week for a three-year PROVINGûTOûBEûAûSHREWDûONE
“I think that the loophole will be shut Source: Thomson Reuters SDC code: B06c Source: Thomson Reuters SDC code: B06d
VERYûQUICKLYû)TûISûMOREûOFûAûTRAPûFORûTHEû
UNAWAREv BYû"LACKSTONEûANDû!KZOû.OBELSûCHEMICALû THINGSûLIKEû&LORAvûSAIDûAûFUNDûMANAGER
Radio broadcaster CUMULUS MEDIA is among BUSINESSûBYû#ARLYLEû'ROUPûANDû')# 4HEûõMûûûNOTEûBACKINGûPARTû
THEûlRSTûCOMPANIESûKNOWNûTOûHAVEû h)TûWILLûBEûVERYûCONCENTRATEDû4HEû OFûTHEûBUYOUTûBYû++2ûOFû&LORAû&OODû'ROUPû
addressed the issue in a recent debt headline number will look big, but Akzo and the spreads business of Unilever, has spent
DOCUMENTûACCORDINGûTOû(ALLOCK Thomson Reuters will make a big chunk of most of its life below reoffer after pricing at
)NûITSûLATESTûCREDITûAGREEMENTûlLEDûWITHû THATvûONEûBANKERûSAID PARûINû!PRILû)NVESTORSûSAIDûITûCAMEûTOOûTIGHTû
the SEC, Cumulus and its lenders agreed The Financial and Risk unit, which will be ANDûTHEûPAPERûISûNOWûBIDûAROUNDûûFORûAû
that division transactions such as those RENAMEDû2ElNITIVûANDûINCLUDESû)&2ûISû YIELDûOFûûACCORDINGûTOû4RADEWEBûDATA
described in Delaware’s new law are expected to sell a total US$3bn of secured After August’s lull, when only two deals
OUTRIGHTûPROHIBITED bonds, split between US$2bn in dollars and printed, supply is expected to pick up in the
Only debt agreements entered into on 53BN
EQUIVALENTûINûEUROSûANDû53BNû lRSTûWEEKûOFû3EPTEMBERûAûSECONDûBANKERû
!UGUSTûûORûLATERûAREûVULNERABLEûTOûTHEû OFûUNSECUREDûCONSISTINGûOFû53BNûDOLLARSû SAID
LOOPHOLEûACCORDINGûTOû+RAMERû,EVIN ANDû53M
EQUIVALENTûEUROS Investors will pay particular attention to
The Akzo Nobel deal is expected to bring THEûlRSTûDEALSûLAUNCHED
õBN
EQUIVALENTûOFûSUBORDINATEDûHIGH
“September is one of those months that is
EUROPE/MIDDLE EAST/ YIELDûBONDS a test of the market in terms of discipline
AFRICA An investor said the nature of supply ANDûPRICEû$EPENDINGûONûHOWûTHESEûDEALSû
would offer different challenges from the come, if they price at the wide end or don’t
CONCENTRATED SUPPLY SET FOR norm: “You used to see a smothering of a go well, they tend to reprice the market,”
SEPTEMBER whole bunch of deals with a lot of issuers SAIDûTHEûlRSTûINVESTOR
DOINGûõM
õMûTRADESvûHEûSAID 4HEûlRSTûBANKERûSAIDûTHEûMARKETûWOULDûBEû
"ANKERSûAREûFORECASTINGûSOMEûõBNûOFûHIGH
Investor resistance to aggressive deals, LESSûDRIVENûBYûRElNANCINGûGIVENûTHEû
yield issuance in Europe this September and which resulted in terms being amended on UNDERLYINGûMOVEûINûRATES
supply is likely to be dominated once again THEûMAJORITYûOFûBONDSûBACKINGûBUYOUTSûPRE
“At the same time, there’s recognition
BYû3INGLEû"ûPAPERûASûSEENûINûTHEûPRE
SUMMERûISûEXPECTEDûTOûCONTINUE that rates are likely going higher, so you
SUMMERûWINDOW “The key thing is, generally in Europe, want to get something done sooner rather
4HEûMAJORûDEALSûEXPECTEDûAREûBONDû there isn’t a huge amount of cash around, so THANûLATERvûHEûADDED
COMPONENTSûOFûlNANCINGSûFORûTHEûBUYOUTSûOFû it would be interesting to see how well these “Some issuers are debating whether to go
Thomson Reuters’ Financial and Risk unit THINGSûPRICEû0EOPLEûAREûGOINGûTOûREMEMBERû right away or wait for a call step-down, but
ALL INTL SWEDISH KRONA BONDS ALL INTL NORWEGIAN KRONE BONDS ALL INTERNATIONAL MEXICAN PESO BONDS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues SKr(m) (%) bank or group issues NKr(m) (%) bank or group issues Ps(m) (%)
1 Danske Bank 35 21,479.86 28.6 1 Danske Bank 16 9,879.95 28.3 1 JP Morgan 7 7,490.93 30.5
2 Swedbank 21 14,740.86 19.6 2 Nordea 9 7,352.36 21.1 2 RBC 7 2,944.42 12.0
3 SEB 6 9,259.81 12.3 3 SEB 2 3,994.59 11.4 3 TD Securities 3 2,407.84 9.8
4 Handelsbanken CM 9 7,550.53 10.0 4 DNB 2 3,209.53 9.2 4 Barclays 1 989.82 4.0
5 Nordea 10 6,575.42 8.7 5 Swedbank 8 2,662.50 7.6 5 BNP Paribas 1 988.44 4.0
6 DNB 4 2,396.23 3.2 6 HSBC 3 1,800.00 5.2 6 Citigroup 1 750.00 3.1
7 Credit Agricole 9 2,305.25 3.1 7 Deutsche Bank 3 1,378.48 3.9 7 Nordea 1 500.00 2.0
8 BNP Paribas 1 991.15 1.3 8 Barclays 1 1,000.00 2.9 8 HSBC 1 491.62 2.0
9 TD Securities 1 750.00 1.0 9 JP Morgan 1 750.00 2.1 Total 30 24,551.32
10 JP Morgan 2 688.43 0.9 10 TD Securities 2 624.21 1.8 Including preferreds. Excluding equity-related debt.
Source: Thomson Reuters SDC code: K16 Source: Thomson Reuters SDC code: K13 Source: Thomson Reuters SDC code: K18
ALL INTERNATIONAL TURKISH LIRA BONDS ALL INTL CANADIAN DOLLAR BONDS GLOBAL DIM SUM BONDS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues TL(m) (%) bank or group issues C$(m) (%) bank or group issues Rmb(m) (%)
1 Sumitomo Mitsui Finl 1 816.50 24.1 1 TD Securities 24 6,766.05 24.2 1 HSBC 51 15,994.02 32.5
2 Nordea 8 689.87 20.3 2 RBC 23 4,954.77 17.7 2 Standard Chartered 35 14,947.15 30.4
3 JP Morgan 4 350.12 10.3 3 BMO 16 4,946.51 17.7 3 Credit Agricole 21 5,475.80 11.1
4 Citigroup 4 264.57 7.8 4 CIBC 20 3,495.21 12.5 4 Bank of China 4 2,005.77 4.1
5 TD Securities 4 211.77 6.2 5 Scotiabank 18 3,074.61 11.0 5 Citic 4 1,903.34 3.9
6 RBC 2 197.09 5.8 6 Natl Bank of Canada Finl 10 1,730.84 6.2 6 BNP Paribas 4 1,241.00 2.5
7 BAML 1 119.71 3.5 7 HSBC 8 1,597.83 5.7 7 Goldman Sachs 2 1,075.00 2.2
8 Credit Agricole 1 107.00 3.2 8 BAML 5 1,278.93 4.6 8 DBS 1 1,000.00 2.0
9 RBC Europe 1 43.43 1.3 9 Goldman Sachs 1 150.00 0.5 =8 KGI Financial Services 1 1,000.00 2.0
Total 31 3,392.07 Total 36 27,994.76 10 China Merchants Bank 1 750.00 1.5
Including preferreds. Excluding equity-related debt. Including preferreds. Excluding equity-related debt. Total 118 49,188.66
Including preferreds. Excluding equity-related debt.
Source: Thomson Reuters SDC code: K17 Source: Thomson Reuters SDC code: K2 Source: Thomson Reuters SDC code: AS24a
SANTANDER UK sold the first UK RMBS since the Virgin Money mandated banks for US and UK More recent comparables are June deals from
break on Thursday but chose to avoid a sterling roadshows ahead of a UK RMBS off its Gosforth Lloyds and Clydesdale Bank which both sold
market which had widened sharply before the Funding vehicle, without indicating what dollar-denominated UK RMBS, off Permanent
summer lull and instead raised over US$1bn currencies it plans to sell. 2018-1 and Lanark 2018-2.
from two US dollar tranches. Santander announced HOLMES 2018-2 on Permanent included a US$1bn 1.95-year
The deal is its second of 2018, following Monday with two dollar tranches on offer: a tranche at 38bp, while Lanark - coming a week
a March new issue which included a sterling short-dated 2a7 piece with a 0.63-year average later on June 28 in a weakening market - sold its
tranche alongside two dollar ones. life and a longer 1.93-year Class A2. IPTs US$400m 1.93-year at 42bp.
Before the summer break a glut of sterling were already shown, at high 30s and mid 40s The Class A1 from Holmes 2018-2 was four
supply spooked investors. Widening spreads respectively. times covered and the A2 was 1.7 times done,
prompted another UK issuer, Barclays, to drop Guidance for the two tranches on Wednesday indicating around US$2.2bn of orders across the
the sterling tranche from its Gracechurch credit was 36bp-38bp and 43bp-45bp before the leads two tranches.
card deal and sell only dollars, despite earlier announced a one-time test tighter on Thursday US investors bought 94% of the Class A1, with
publishing IPTs for both currencies. morning at 35bp and 42bp. That test was UK accounts taking 6%. Asset managers bought
And by the end of July Capital Home Loans successful, with final pricing one-month Libor plus 83%, official institutions 11%, and banks 6%.
had to pay a 100bp discount margin, a full 25bp 35bp on the US$210m Class A1 and three-month On the Class A2, US investors accounted
more than a comparable deal from five weeks Libor plus 42bp for the US$800m Class A2. for 82% and UK buyers 18%. Asset managers/
earlier, when it printed Triple As backed by a Holmes 2018-1 in March sold its US$200m insurance bought 74%, official institutions 16%,
well-regarded pool of buy-to-let UK mortgages. 0.63-year tranche at 37bp over one-month Libor and banks 10%.
Syndicates have been flagging a heavy and the US$750m 1.99-year note at 36bp over BAML, Citigroup, Credit Suisse, Lloyds and
sterling pipeline for September with a full three-month Libor. That deal’s £300m 4.88-year Santander were joint leads.
range of asset classes expected. On Friday came at 36bp over three-month Libor. Chris Moore
“They have very little room to Fitch caps ratings below Double A where
MANOEUVREvûSAIDûANûINVESTORûh4HEYû ASSETSûMAKEûUPûhAûSIGNIlCANTûSHAREûOFû
DONTûHAVEûTOûRElNANCEûTHEûBONDûINûTHEû STRUCTURED FINANCE collateral value without being prime
bond market, if they get some extra quality”, meaning it could not give Triple or
SUPPORTûFROMû4RAlGURAûWHICHûISû $OUBLEû!ûRATINGSûTOûTHEû#-"3
HOWûTHEYûSURVIVEDûOVERûTHEûLASTûlVEû EMEA MBS Fitch’s unsolicited comment also warns
YEARSv THATûTHEû@-AROONûLOANûWHILEûBENElTINGû
#OMMODITYûTRADERû4RAlGURAûISû.YRSTARSû FITCH FIGHTS OVER ELIZABETH FINANCE from diversity, is backed by shopping
largest shareholder and has supported it UK CMBS centres “exposed to the mounting
through capital raises, loans and zinc and CHALLENGESûAFmICTINGûTHEû5+ûHIGHûSTREETû
SILVERûPRE
PAYMENTS &ITCHû2ATINGSûSAIDûLASTûWEEKûTHEûSMALLû5+û#-"3û ESPECIALLYûFORûSECONDARY
QUALITYûSTOCKv
h)Fû4RAlGURAûDOESNTûSUPPORTûTHEMûTHEYû ELIZABETH FINANCE 2018, which was quietly priced h3OûEVENûSETTINGûASIDEûTHEû#-"3ûPRO
RATAû
COULDûBYûAûWHISPERûRElNANCEûITûBYûDRAWINGû mid-August by Goldman Sachs, could not support STRUCTUREvû&ITCHûSAYSûhTHEûCREDITûPROlLEûOFû
on their revolving credit facility, but they &ITCHSûOWNû4RIPLEû!ûORû$OUBLEû!ûRATINGS THEû-AROONûLOANûPOSESûITSûOWNûSETûOFûRISKSv
have no room for error in the next six &ITCHûDIDNTûRATEûTHEûaMûDEALû “It’s not a bad thing that rating agencies have
months,” he said, also pointing to volatility 3TANDARDûû0OORSûANDû$"23ûRATEDûITSûlVEû different points of view, and it’s good for
AROUNDûCOMMODITYûPRICES TRANCHESûFROMû4RIPLEû!ûTOû$OUBLEû" investors to understand what those differences
4HEûCOMPANYûREPORTEDûõMûINûCASHûANDû The deal securitises two loans from actually are,” said Rob Ford, portfolio manager
CASHûEQUIVALENTSûINûITSûRESULTSû)NûADDITIONûTOû GOLDMAN SACHSûTHEûaûMILLIONû@-AROONû ATû4WENTY&OURû!SSETû-ANAGEMENT
THEûûBONDSûITûOWESû4RAlGURAûõMû loan secured on three shopping centres in The deal, which was not seen publicly
ANDûHASûAûõMûCONVERTIBLEûBONDûISSUEûDUEû %NGLANDûANDû3COTLANDûANDûTHEûaMû@-#2û MARKETEDûSOLDûITSûaMû
YEARû4RIPLEû
TOûMATUREûONû3EPTEMBERû LOANûSECUREDûONûAûCAMPUS
STYLEûOFlCEû !SûATûTHREE
MONTHû,IBORûPLUSûBPû4HISûISû
4HEû!".û!-2/ûANALYSTSûSAIDûMARKETû BUILDINGûINû-ANCHESTER WELLûWIDEûOFûTHEûMOSTûRECENTû5+û#-"3ûNEWû
DOUBTSûABOUTûTHEûCOMPANYSûlNANCIALûHEALTHû &ITCHûCITINGû$"23SûPRE
SALEûREPORTûPOINTSû ISSUEû4AURUSû
ûFROMû"ANKûOFû!MERICAû
could lead to its liquidity headroom OUTûTHATûIFûAûLOANûISûRElNANCEDûREPAYMENTSû -ERRILLû,YNCHûWHICHûSOLDûAûaMû
deteriorating quickly, which would make to noteholders will be applied on a pro-rata YEARû4RIPLEû!ûATûPLUSûBP
banks less likely to provide letters of credit BASIS &URTHERûDOWNûTHEû%LIZABETHû&INANCEûû
under uncommitted facilities and impact )FûTHEûLARGERûLOANûISûRElNANCEDûTHEû STACKûTHEûaMû!!!!LOW ûCAMEûATûPLUSû
MATERIALûSHIPMENTSûTOû.YRSTAR portion of Class A notes still outstanding BPûTHEûaMû!!LOW ûATûPLUSûBPû
Such a scenario, they said, could lead WOULDûBEûBACKEDûSOLELYûBYûTHEû-#2ûLOANû THEûaMû""""""LOW ûATûPLUSûBPûANDû
Nyrstar to draw on its working capital "ASEDûONûINFORMATIONûFROMûTHEûVALUATIONû THEûaMû""""ûATûPLUSûBP
facility at quarter-end, which would impact report, Fitch describes the MCR loan as Fitch says its own credit opinions
ITSûHEADLINEûNETûDEBTûlGURE hSECONDARY
QUALITYûOFlCEvûhHIGHLYû CONVERGEûMOREûCLOSELYûWITHûTHEû$"23û
.YRSTARûDECLINEDûTOûCOMMENT CONCENTRATEDûANDûIDIOSYNCRATICv RATINGSûFORû#LASSESû#ûTOû%
ONESAVINGS BANK EYES Q4 RMBS non-conforming mortgages originated by dollars since the launch of the Term
RETURN '-!#û!DVANTAGEûANDû0RECISE &UNDINGû3CHEMEûINû!UGUSTû
“We remain committed to funding our loan 4HOSEûDOLLARSûATû53MûFORûAû
ONESAVINGS BANK expects to return to the book using retail savings and funding additional YEARûAVERAGEûLIFEûWEREûPRICEDûATûBPûOVERû
securitisation market in the fourth quarter liquidity requirements through wholesale ,IBORû)NûSTERLINGûAû
YEARûaMûNOTEû
with a new residential mortgage-backed MARKETSvûTHEûBANKûSAIDûONû4HURSDAY CAMEûATûBPûOVER
securitisation programme, according to its )Nû*UNEûTHISûYEARû#9"'ûOWNERûOFû
HALF
YEARûREPORTûONû4HURSDAY VIRGIN MONEY READIES GOSFORTH RMBS #LYDESDALEû"ANKûANDû9ORKSHIREû"ANKûAGREEDû
4HEûBANKûHASûaBNûOFûOUTSTANDINGû TOûBUYû6IRGINû-ONEYûFORûaBN
drawings under the government Term VIRGIN MONEY mandated Bank of America Merrill
&UNDINGû3CHEMEûWHICHûCLOSEDûINû&EBRUARYû Lynch, BNP Paribas, Citigroup and Lloyds for a
)SSUINGû2-"3ûISûONEûWAYûTOûREPLACEûTHATû series of investor meetings in the US and UK EMEA ABS
FUNDINGûTHEûBANKûSAID AHEADûOFûAûPOSSIBLEû2EGû3AûISSUEûOFFûITSû
/NE3AVINGSû"ANKûSOLDûANû2-"3û GOSFORTH FUNDINGû5+û2-"3ûPROGRAMME EURO EYES ON VW NEW ISSUE DUE
2OCHESTERû&UNDINGû.OûINûû4HATûDEALû The originator last came to market with WEDNESDAY
did not securitise the bank’s own 'OSFORTHû&UNDINGû
ûINû3EPTEMBERûLASTû
origination, but was backed by pre-crisis YEARû4HATûDEALûWASûTHEûlRSTû5+û2-"3ûTOûSELLû VOLKSWAGEN BANK is set to reopen the euro-
denominated securitisation market this
GLOBAL SECURITISATIONS IN STERLING SECURITISATIONS – ALL EUROPEAN RMBS WEEKûWHENûITûPRICESû'ERMANûAUTOûLOANû!"3û
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE DRIVER FIFTEENûONû7EDNESDAY
Managing No of Total Share Managing No of Total Share %VENûTHEûEVERGREENû'ERMANûAUTOû!"3û
bank or group issues £(m) (%) bank or group issues €(m) (%) sector has not been immune to the spread
1 Lloyds Bank 14 2,087.35 16.6 1 BAML 16 3,117.99 14.6 widening that took hold in the run up to the
2 BAML 14 1,789.68 14.3 2 Lloyds Bank 10 2,349.46 11.0 SUMMERûBREAK
3 Citigroup 8 1,112.41 8.9 3 Morgan Stanley 8 1,775.38 8.3 At the start of the year benchmark Triple
4 MUFG 1 1,006.20 8.0 4 Citigroup 9 1,726.58 8.1 As were coming at discount margins of
5 HSBC 6 904.47 7.2 5 BNP Paribas 7 1,590.44 7.4 BPûINCLUDINGû67SûOWNû$RIVERûFOURTEENû
6 BNP Paribas 8 857.92 6.8 6 JP Morgan 4 1,393.88 6.5 INû&EBRUARY
7 Barclays 6 838.66 6.7 7 Cooperatieve Rabobank 2 1,355.98 6.3 7IDENINGûWHENûITûARRIVEDûWASûMODESTû)Nû
8 Natixis 5 662.92 5.3 8 SG 1 1,074.57 5.0 *UNEû3ANTANDERSû3#û'ERMANYû!UTOû
û
9 Morgan Stanley 4 636.76 5.1 9 Credit Agricole 1 1,015.28 4.7 CAMEûATûBPû-ERCEDES
"ENZû"ANKSû3ILVERû
10 Deutsche Bank 3 532.57 4.2 10 Barclays 4 806.22 3.8 !RROWûûFOLLOWEDûINû*ULYûWITHûAûBPûPRINT
Total 36 12,541.85 Total 39 21,406.21 At the time market participants said the
Including Euro, foreign, global and domestics, excluding CDOs. Including Euro, foreign, global and domestics, excluding CDOs. Silver Arrow pricing was, unusually, well
inside softening secondary levels for the
Source: Thomson Reuters SDC code: B16i Source: Thomson Reuters SDC code: B10a ASSETûCLASSû"ANKERSûALSOûPOINTEDûTOûAûSTRONGû
ALL EUROPEAN ISSUERS GLOBAL STRUCTURED FINANCE IN EUROS ALL INTL ISSUERS (EXCLUDING SELF-FUNDED)
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues US$(m) (%) bank or group issues €(m) (%) bank or group issues US$(m) (%)
1 BAML 18 4,806.19 9.2 1 SG 6 2,906.52 11.5 1 JP Morgan 77 18,780.00 9.7
2 Lloyds Bank 15 4,108.37 7.9 2 Credit Agricole 7 2,748.36 10.8 2 Citigroup 81 17,356.65 9.0
3 SG 7 3,644.36 7.0 3 UniCredit 8 1,874.41 7.4 3 Credit Suisse 77 16,732.69 8.6
4 BNP Paribas 15 3,471.38 6.6 4 BNP Paribas 7 1,740.61 6.9 4 BAML 69 15,203.51 7.8
5 Credit Agricole 7 3,365.76 6.4 5 Commerzbank 3 1,648.06 6.5 5 Wells Fargo 59 14,158.99 7.3
6 Citigroup 14 3,314.50 6.3 6 BAML 4 1,461.65 5.8 6 Deutsche Bank 58 11,238.12 5.8
7 UniCredit 8 2,254.29 4.3 7 Cooperatieve Rabobank 2 1,355.98 5.3 7 Barclays 44 10,212.07 5.3
8 Morgan Stanley 8 2,137.35 4.1 8 Morgan Stanley 4 1,052.00 4.1 8 Goldman Sachs 36 9,204.16 4.8
9 Barclays 7 2,136.84 4.1 9 JP Morgan 2 1,013.91 4.0 9 Morgan Stanley 29 7,018.97 3.6
10 Commerzbank 3 1,996.65 3.8 10 Citigroup 4 992.76 3.9 10 RBC 23 5,229.70 2.7
Total 81 52,233.79 Total 41 25,383.49 Total 363 193,716.16
Includes securitisations, credit-linked notes (Euro, foreign, global and Includes securitisations, credit-linked notes (Euro, foreign, global and Includes securitisations, PFI bonds and credit-linked notes. Excludes US
domestics) and excludes CDOs. domestics) and excludes CDOs. global ABS/MBS, CDOs and self funded issues.
Source: Thomson Reuters SDC code: B16n Source: Thomson Reuters SDC code: B16g Source: Thomson Reuters SDC code: J10d
US ASSET-BACKED SECURITIES GLOBAL STRUCTURED FINANCE IN US$ STRUCTURED FINANCE – ALL INTL ISSUERS
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues US$(m) (%) bank or group issues US$(m) (%) bank or group issues US$(m) (%)
1 Citigroup 129 47,479.86 17.4 1 Citigroup 204 73,953.82 16.2 1 JP Morgan 77 18,780.00 8.9
2 JP Morgan 78 19,508.32 7.2 2 JP Morgan 165 52,288.94 11.4 2 Citigroup 83 17,849.77 8.4
3 BAML 67 18,197.70 6.7 3 Wells Fargo 146 45,556.63 10.0 3 BAML 75 17,089.48 8.1
4 Deutsche Bank 66 15,058.32 5.5 4 Credit Suisse 140 44,297.31 9.7 4 Credit Suisse 77 16,732.69 7.9
5 Barclays 60 13,908.67 5.1 5 BAML 129 40,917.39 8.9 5 Wells Fargo 63 15,322.37 7.2
6 RBC 49 13,606.18 5.0 6 Goldman Sachs 85 29,173.38 6.4 6 Barclays 50 12,037.34 5.7
7 Wells Fargo 63 12,586.48 4.6 7 Morgan Stanley 71 23,603.07 5.2 7 Deutsche Bank 60 11,951.38 5.6
8 Mizuho 35 9,542.72 3.5 8 Barclays 87 22,255.41 4.9 8 Goldman Sachs 38 9,689.42 4.6
9 Credit Suisse 44 8,301.78 3.0 9 Deutsche Bank 90 21,056.38 4.6 9 Morgan Stanley 33 8,125.19 3.8
10 Goldman Sachs 36 7,647.37 2.8 10 RBC 58 16,758.06 3.7 10 RBC 25 6,279.69 3.0
Total 484 272,551.54 Total 847 457,422.49 Total 395 211,549.07
Excludes MBS. Including securitisations (Euro, foreign, global and domestics, excluding Includes securitisations, PFI bonds, self-funded issues and credit-linked
CDOs) and PFI bonds. notes. Excludes US global ABS/MBS and CDOs.
Source: Thomson Reuters SDC code: F14 Source: Thomson Reuters SDC code: B16b Source: Thomson Reuters SDC code: J10c
IFR MARKETS
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SSAR
EUROS
Aug 20 2018 Berlin, State of €500m Aug 27 2038 1.375 99.913 MS-1 / B+68.7 1.38
Aug 21 2018 Municipality Finance €250m incr Oct 15 2021 0.1 100.983 MS-21 -0.213
(€1.5bn)
Aug 22 2018 Lower Saxony, State of €100m incr Jun 13 2025 0.5 101.112 MS-17 / B+43.4 0.334
(€600m)
Aug 22 2018 KommuneKredit €500m Aug 28 2023 0.125 99.881 MS-12 / B+48 0.149
Aug 22 2018 Hessen, State of €250m incr Jan 25 2024 0.125 100.07 MS-22 / B+32.5 0.112
(€750m)
Aug 24 2018 Schleswig-Holstein, State of €500m Aug 31 2928 0.625 98.905 MS-14 / B+39.4 0.739
STERLING
Aug 21 2018 International Finance Corp £500m Mar 7 2025 1.375 99.78 G+32 1.406
Aug 22 2018 Oesterreichische £100m incr Dec 15 2022 1.125 99.328 G+38 1.283
Kontrollbank (£350m)
Aug 22 2018 Rentenbank £250m Sep 8 2025 1.375 99.521 G+33 1.442
Aug 23 2018 Inter-American Development £250m Dec 15 2024 1.375 99.848 G+32 1.396
Bank
Aug 24 2018 Asian Development Bank £250m Mar 7 2025 1.375 99.588 G+33 1.437
US ABS DEAL PRICINGS COMMERCIAL CREDIT GROUP PROSPER MARKETPLACE ISSUANCE TRUST (PMIT) SERIES
CCGûPRICEDûAû53MûEQUIPMENTû!"3û 2018-2ûCredit Suisse structured
the deal and
0RIMARYû!"3ûSPREADSûINCHEDûTIGHTERûLASTû called CCG RECEIVABLES TRUST 2018-2 (CCG 2018-2)û WASûAûJOINTûBOOKRUNNERûWITH Jefferies.
week as investors snapped up the limited BMO STRUCTUREDûTHEûDEALûANDûWASûAûJOINTû #OLLATERALû5NSECUREDûCONSUMERûLOANS
NEWûPAPERûONûOFFER bookrunner with JP Morgan and Wells Fargo. ,ARGESTûTRANCHEû#LASSû!û53MûONE
HONDA bumped up the size of its prime Collateral: Fixed-rate commercial YEARû7!,ûRATEDû!!ûPRICEDûATû%$3&ûPLUSû
AUTOûDEALûTOû53BNûFROMû53BNû equipment loans and leases originated by BP
ANDûSHAVEDûOFFûAûFEWûBASISûPOINTSû)TSûLARGESTû #OMMERCIALû#REDITû'ROUP
YEARû4RIPLEû!ûCLASSûCLEAREDûATûBPûOVERû ,ARGESTûTRANCHEû#LASSû!
û53Mû
%$3&ûTIGHTERûTHANûTALKûINûTHEûBPnBPû
YEARû7!,ûRATEDû4RIPLEû!ûPRICEDûATû ASIA-PACIFIC MBS
RANGE EDSF plus 33bp versus guidance at EDSF
COMMERCIAL CREDIT GROUP cleared the biggest PLUSûBPnBP BLUESTONE SETS RMBS GUIDANCE
SLICEûOFûITSû53MûEQUIPMENTû
securitisation deal at EDSF plus 33bp versus HONDA Specialist residential mortgage lender
GUIDANCEûOFûBPnBP HONDAûPRICEDûANûUPSIZEDû53BNûPRIMEû BLUESTONE GROUP has released price guidance
PROSPERûPRICEDûITSû53MûPERSONALû auto loan transaction, HONDA AUTO RECEIVABLES FORûlVEûTRANCHESûOFûTHEû!USTRALIANûDOLLARû
loan securitisation near record lows 2018-3 OWNER TRUST (HAROT 2019-3) Bank of America SAPPHIRE XIX 2018-2ûNON
CONFORMINGû2-"3û
FORûITSû0-)4ûISSUANCEûPLATFORMû)TSû Merrill Lynch structured the deal and was a OFFERING
RISKIESTû3INGLEû"ûPLUSûCLASSûPRICEDûATû JOINTûBOOKRUNNERûWITHûSMBC and Wells Fargo. &ORûTHEû!MûOFû#LASSû!û!MûOFû
BPûOVERûSWAPSûORûBPûTIGHTERû #OLLATERALû.EWûANDûUSEDû(ONDAûANDû #LASSû!AûANDû!MûOFû#LASSû!BûNOTESû
than similar PMIT bonds debuted in Acura automobiles, light-truck and utility WITHûRESPECTIVEû7!,SûOFûûûANDûû
-AYû vehicle loans originated and serviced by YEARSûGUIDANCEûISûONE
MONTHû""37ûPLUSû
!MERICANû(ONDAû&INANCEû#ORPORATION BPûAREAûBPûAREAûANDûBPnBP
CAZENOVIA CREEK ,ARGESTûTRANCHEû#LASSû!û53Mû
&ORûTHEû!MûOFû#LASSû%SûANDû!MûOFû
CAZENOVIA CREEKûPRICEDûAû53MûPROPERTYû year WAL; rated Triple A; priced at EDSF #LASSû&SûWITHû7!,SûOFûûANDûûYEARSû
tax liens called CAZENOVIA CREEK FUNDING II PLUSûBPûVERSUSûGUIDANCEûATû%$3&ûPLUSû GUIDANCEûISûLOWûSûANDûLOWûSûOVERûONE
SERIES 2018-1ûHunt Financial is the sole BPnBP MONTHû""37
STRUCTURINGûADVISERû.OûPRICINGûDETAILSûAREû $IRECTûCOMPû(!2/4û
û û 4HEû#LASSû"û#ûANDû$ûNOTESûHAVEûBEENûPRE
AVAILABLE #LASSû!û53Mû
YEARû7!,ûRATEDû PLACEDûWHILEûTHEû'ûNOTESûWILLûBEûRETAINED
Collateral: The initial portfolio consists 4RIPLEû!ûPRICEDûATû%$3&ûPLUSûBP Macquarie and CBAûAREûJOINTûLEADû
ENTIRELYûOFûPROPERTYûTAXûLIENSûINûûSEPARATEû MANAGERS
STATESûSECUREDûBYûûINDIVIDUALû PROSPER )Nû&EBRUARYû"LUESTONEû'ROUPûISSUEDûAû
properties; according to a pre-sale from PROSPERûPRICEDûAû53MûTOTAL û !MûNON
CONFORMINGû2-"3ûTHROUGHû
+"2! UNSECUREDûCONSUMERûLOANû!"3ûCALLEDû 3APPHIREû86)))û
MS+1, - >€1.25bn Aa1/-/AAA/AAA BLB/CMZ/Deka/DZ/JPM Ger 60%, Fr 15%, Switz 10%, Asia 5%,
MS flat (+/-1) UK 4%, Other 6%, AM/Ins 58%, Bks
21%, CB/OI 14%, Other 7%
MS-21 area - - Aa1/AA+ BAML/Citi -
- - - -/-/AAA BLB -
MS-10 area, - €990m Aaa/AA+ BNPP/LBBW/SG Nordics 39.6%, UK/Ire 21.9%, Ger/Aut/
MS-11 area Switz 17.5%, Fra 8.8%, Benelux 7.2%,
Asia 4.8%, Other 0.2%, Bks/PB 33.3%,
CB/OI 23%, FM 21.7%, Ins/Pens 17%,
Other 5%
- - - -/AA+ Deka/DZ/Helaba/HSH/JPM -
G+33 area - - Aaa/AAA Barc/BAML/RBC UK 63%, EMEA 37%, Bks 73%, CB/OI
17%, AM 10%
G+38 area - - Aa1/AA+ HSBC/RBC -
SWISS FRANCS
Aug 23 2018 Banque Cantonale SFr160m Sep 14 2026 0.35 100.177 MS+12 -
Neuchateloise
NON CORE
Aug 22 2018 Stockholms Lans Landsting SKr500m Aug 30 2021 0.06 Undisclosed - -
Aug 23 2018 World Bank A$110m Aug 28 2020 2.2 99.901 ASW+23 2.251
Aug 23 2018 Nederlandse A$25m incr Jul 17 2028 3.45 102.485 ASW+56 / 3.155
Waterschapsbank (A$965m) ACGB+63
Aug 24 2018 KfW A$100m incr Mar 15 2028 3.2 Undisclosed ASW+38 / -
(A$600m) ACGB+42.75
Aug 24 2018 IFC A$100m incr Apr 3 2025 4 107.408 ASW+40 / 2.763
(A$1.175bn) ACGB+40
CORPORATES
US DOLLARS
Aug 21 2018 Fluor Corporation US$600m Sep 15 2028 4.25 99.787 T+145 4.276
Aug 21 2018 Northwest Pipeline US$250m incr Apr 1 2027 4 99.558 T+135 4.201
Aug 22 2018 Timken Co US$400m Dec 15 2028 4.5 99.868 T+170 4.517
EUROS
Aug 22 2018 Citycon Treasury €300m Jan 15 2027 2.375 99.096 MS+180 / B+240.9 2.497
Aug 23 2018 BMW Finance €1bn Nov 29 2021 0.125 99.751 MS+18 / B+69.6 0.202
Aug 23 2018 BMW Finance €750m Aug 29 2025 1 99.859 MS+48 / B+104.2 1.021
STERLING
Aug 23 2018 Daimler International £500m Sep 4 2023 2 99.796 G+103 2.033
Finance
SWISS FRANCS
Aug 21 2018 Luzerner Kantonsspital SFr150m Sep 25 2028 0.625 100.557 MS+19 -
NON CORE
Aug 21 2018 VW Financial Services A$350m Feb 28 2022 3.3 99.762 ASW+120 3.373
Australia
Aug 23 2018 Vasakronan (Green) SKr550m Jun 30 2021 3mSt+75 101.122 3mSt+36 -
Aug 23 2018 Fabege (Green) SKr700m Aug 30 3023 3mSt+113 100 3mSt+113 -
Aug 23 2018 Fabege (Green) SKr300m Aug 30 3023 1.5 Undisclosed - -
Aug 24 2018 Z Energy NZ$125m Sep 3 3024 4 100 MS+150 4
FINANCIALS
US DOLLARS
Aug 20 2018 Pricoa Global Funding US$500m Sep 1 2023 3.45 99.991 T+75 3.452
Aug 21 2018 ABN AMRO US$1bn Aug 27 2021 3.4 99.927 T+75 3.426
Aug 21 2018 ABN AMRO US$1bn Aug 27 2021 3mL+57 100 3mL+57 -
Aug 22 2018 Bank of America NA US$1.75bn Aug 28 2020 (2019) 3mL+25 100 3mL+25 -
Aug 22 2018 Nordea Bank (SNP) US$750m Aug 30 2023 3.75 99.865 T+108 3.78
Aug 22 2018 Nordea Bank (SNP) US$250m Aug 30 2023 3mL+94 100 3mL+94 -
Aug 23 2018 JP Morgan Chase Bank NA US$1.25bn Sep 1 2020 (Sep 2019) 3mL+23 100 3mL+23 3mL+23
EUROS
Aug 20 2018 Berlin Hyp (SP) €300m Aug 28 2023 0.375 99.926 MS+13 / B+73.6 0.39
Aug 20 2018 Swedbank €500m Aug 29 2023 0.4 99.822 MS+18 / B+76.2 0.436
- - - A+ (ZKB) ZKB/BCV -
- - - -/AA+ Danske -
ASW+23 - - Aaa/AAA CBA -
- - - Aaa/AAA TD -
ASW+40 - - Aaa/AAA TD
G+115 area, 16 £1bn A2/A/A- GS/HSBC UK 88%, Ger/Aut 4%, Benelux 3%, Spain
G+105 area 2%, Asia 2%, Other 1%, AM 62%, Ins
22%, Pens 5%, Bks/PBs 4%, Sov/CB 4%,
Corp 2%, Other 1%
- - - A3 HCM -
- - - Baa3 HCM/Swed -
- - - Baa3 HCM/Swed -
MS+140-150 - - Unrated Deutsche Craigs/Forsyth/WBC -
MS+15 area - .€375m Aa2/-/A+ CMZ/DZ/LBBW Ger 98%, Fr 1%, UK 1%, Bks 84%, Ins
10%, FM 6%
MS+30 area, - ~€2bn Aa2/AA-/AA- BAML/Citi/GS/HSBC/Swed Ger/Aut 50%, UK 15%, Benelux 14%, Fr
MS+20 area 10%, Nordics 8%, Other 3%, FM 46%,
Ins/Pens 22%, Bks/PB 19%, CB/OI 11%,
Corps 2%
Aug 21 2018 Commerzbank (SP) €1.25bn Aug 28 2023 0.5 99.435 MS+35 / B+94.3 0.615
Aug 21 2018 Commerzbank (SP) €500m Aug 28 2028 1.5 99.825 MS+65 / B+119.4 1.519
Aug 22 2018 Bank of Ireland Group €750m Aug 29 2023 1.375 99.808 MS+115 / B+173.2 1.415
Aug 22 2018 OP Corporate Bank €500m Aug 29 2023 0.375 99.453 MS+22 / B+78.1 0.486
Aug 22 2018 Rabobank (SNP) €1bn Aug 29 2023 0.75 99.663 MS+55 / B+112 0.819
Aug 22 2018 National Australia Bank €750m Aug 30 2023 0.625 99.995 MS+35 / B+89.5 0.626
(Green)
Aug 22 2018 National Australia Bank €1.25bn Aug 30 2028 1.375 99.731 MS+53 / B+105.4 1.404
Aug 23 2018 Deutsche Bank (SP) €1bn Aug 30 2023 1.125 99.773 MS+90 / B+147.4 1.172
Aug 23 2018 Belfius Bank €500m Aug 30 2023 0.625 99.75 MS+40 / B+95.2 0.676
Aug 23 2018 Intesa Sanpaolo €1bn Aug 30 2023 2.125 99.869 MS+188 / B+244.4 2.153
Aug 24 2018 Barclays plc €750m Sep 3 2023 1.5 99.599 MS+130 / B+186.4 1.584
SWISS FRANCS
Aug 20 2018 Banco Santander SFr150m Dec 10 2024 1 100.005 MS+100 / 0.999
Eidg+133.4
Aug 22 2018 Credit Suisse Group SFr250m Perpetual (Sep 2024) 3.5 100 MS+354 3.5
NON CORE
Aug 20 2018 Bank Australia A$125m Aug 30 2021 3mBBSW+130 100 3mBBSW+130 -
(Sustainability)
Aug 20 2018 Commerzbank (T2) A$225m Oct 29 2028 5.5 100 - 5.5
COVERED BONDS
EUROS
Aug 21 2018 Aareal Bank €500m Jul 15 2025 0.375 99.561 MS-8 0.44
Aug 21 2018 Eika Boligkreditt €500m Aug 28 2025 0.5 99.582 MS+3 / B+61.1 0.561
Aug 22 2018 Deutsche Pfandbriefbank €500m Aug 30 2027 0.625 98.933 MS-2 0.748
Aug 22 2018 RLB Niederoesterreich-Wien €500m Aug 28 2026 0.625 99.527 MS+3 / B+59.7 0.686
Aug 23 2018 Berlin Hyp €250m incr May 30 2023 0.25 100.506 MS-10 / B+43.3 0.143
(€750m)
SWISS FRANCS
Aug 22 2018 PSHypo SFr100m incr Apr 26 2024 0.125 101.284 MS-2 / Eidg+29.9 -0.102
(SFr675m)
Aug 22 2018 PSHypo SFr351m Jul 10 2028 0.375 100.141 MS-1 / Eidg+49.1 0.36
Aug 22 2018 PSHypo SFr265m Jan 23 2043 1 102.036 MS-2 / Eidg+45.2 0.907
HIGH YIELD
EUROS
Aug 22 2018 Teekay LNG Partners NKr850m Aug 29 2023 3mN+460 100 3mN+460 -
MS+50 area, - €2.9bn A1/A-/A- Barc/BNPP/CMZ/DB/UBS Ger 37%, UK 24%, Fr 16%, Aut/Switz 10%,
MS+40 (+/-5) Benelux 5%, Sth Eur 4%, Scandi 2%, Other
2%, Funds/AM 61%, Bks 22%, Govt/Agency
6%, Ins/Pens 4%, PB 3%, Other 4%
MS+80 area, - €2.4bn A1/A-/A- Barc/BNPP/CMZ/DB/UBS Ger 30%, UK 26%, Fr 17%, Scandi 10%,
MS+70 (+/-5) Benelux 8%, Aut/Switz 7%, Asia 1%,
Other 1%, Funds/AM 61%, Ins/Pens 25%,
Bks 6%, Govt/Agency 5%, Other 3%
MS+130 area. - €2bn Baa3/BBB-/BBB JPM/NatWest/Nom/UBS UK/Ire 31%, Ger/Aut/Switz 28%, Nordics
MS+115/120 26%, Sth Eur 6%, Fr 4%, Benelux 4%,
Other 1%, FM 81%, Bks 8%, Ins Pens 7%,
Other 4%
MS+30 area, - €800m Aa3/AA- BAML/DZ/OP Nordics 36%, Ger/Aut 26%, UK 15%,
MS+25 (+/-3) Sp 10%, Benelux 7%, Fr 5%, Other 1%,
Bks/PB 40%, OI/22%, AM 20%, Ins/
Pens 18%
MS+low 70s, - €4.7bn A3/A-/AA- BNPP/CS/HSBC/MS/Rabo Fr 21%, UK/Ire 20%, Ger/Aut 18%,
MS+57 (+/-2) Benelux 12%, Nordics 9%, Switz 7%, Asia
5%, Sth Eur 4%, North Amer 3%, Other
1%, AM 62%, Ins/Pens 16%, CB/OI 12%,
Bank/PB 9%, Other 1%
MS+50 area, - €2.4bn Aa3/AA- BNPP/Citi/NAB/UBS Ger/Aut 25%, UK/Ire 22%, Benelux 18%,
MS+35/40) Fr 13%, Nordics 6%, Other Eur 6%, Switz
5%, Asia 4%, Other 1%, AM 51%, Ins/Pens
20%, Bks/FI 15%, CB/OI 12%, Other 2%
MS+65 area, - €1.8bn Aa3/AA- BNPP/Citi/NAB/UBS Fr 40%, Ger/Aut 35%, UK/Ire 8%, Asia
MS+55 area 6%, Othe Eur 5%, Benelux 2%, Nordics
2%, Switz 2%, AM 41%, Ins/Pens 40%,
Bks/FI 14%, CB/OI 4%, Other 1%
MS+95 area, - €1.6bn A3/BBB+/A- DB -
MS+90
MS+50 area, - €825m A2/A- BAML/Belfius/BNPP/CMZ/Lloyds Ger/Aut/Switz 34%, Benelux 23%, Fr
MS+40/42 23%, UK 13%, Italy/Iberia 7%, AM 50%,
Bks 38%, Ins/Pens 11%, CB/OI 1%
MS+200 area, - €1.7bn Baa1/BBB/BBB IMI/DB/JPM/SG/UBS -
MS+190 (+/-2)
MS+135 area - €1.1bn Baa3/BBB/A Barc -
3.375%/3.625% - - -/BB-/BB CS -
3mBBSW+133 area - >A$250m Baa1/BBB ANZ Aust 95%, Offshore 5%, AM 48%, Bks
27%, Local Councils 14%, Religious
Entities 6%, Other 5%
5.5% area - - Baa3/BBB-/BBB/ CMZ/DB/NAB/TD -
BBB
MS-5 area 2 <€900m Aaa DZ/LBBW/Nat/NordLB/SG Ger 83%, Nordics 11%, Asia 2%, UK 1%,
Aut/Switz 1%, Other 2%, Bks 36%, CB/
OI 22%, FM 21%, Ins 20%, Other 1%
MS+7 area, 3 >€1.3bn Aaa CMZ/DB/ING/Sant/UBS Ger/Aut 60%, Nordics 14%, Ben 13%, UK/
MS+4 (+/-1) Ire 6%, Switz 4%, Asia 2%, Other 1%, Bks/
PB 75%, AM 14%, CB/OI 8%, Pens/Ins 3%
MS flat area 3 >€720m Aa1 Barc/BLB/DZ/SG/Uni Ger 88%, Switz 5%, UK 3%, Other 2%,
Asia 1%, Fra 1%, Bks 44%, AM 42%, Ins
8%, CB/OI 6%
MS+4 area. 4 >€650m Aaa CMZ/DZ/Helaba/RBI/SG Ger 41%, Aut 32%, Nordics 10%, It 6%,
MS+3 area Benelux 4%, Switz 3%, UK 2%, Other
2%, Bks 60%, FM 22%, CB/OI 18%
MS-10 area - >€400m Aaa CA/CMZ/DZ/LBBW/Uni Ger 67%, Asia 13%, Nordics 11%, UK 9%,
Bks 40%, FM 30%, CB/OI 29%, Ins 1%
- - - Aaa CS/UBS/SVR -
- - - Aaa CS/UBS/SVR -
- - - Aaa CS/UBS/SVR -
to issue an additional US$100m. banks to arrange investor meetings in Hong Source: Thomson Reuters SDC code: L4
The JGCs are also joint lead managers and RCom was holding a bondholder Deutsche Bank, HSBC and JP Morgan as joint
joint bookrunners with Guotai Junan meeting on Friday August 24 to vote on bookrunners.
International. WAIVERSûANDûMODIlCATIONSûTOû53Mû The notes are expected to be rated Baa2 by
Fixed-income investor meetings in Hong 6.5% senior secured notes due in 2020 as Moody’s.
Kong and Europe will start on Monday for a part of a restructuring scheme. The issue will constitute a drawdown
proposed Reg S-only senior unsecured bond. The bondholder meeting was originally under BPI’s MTN programme established in
The notes will be issued by Anhui scheduled for August 10 but the company June.
Transportation Holding Group (HK) and will failed to reach a quorum. The voting on
be unconditionally and irrevocably Friday needed participation from holders
guaranteed by the company. of only 25% of the bonds to form a quorum. SOUTH KOREA
Expected ratings are on par with the The vote is a key step in RCom’s bid to
issuer. avoid bankruptcy by selling assets and KDB SET TO RETURN TO SAMURAI MARKET
slashing its debt burden.
CHINESE FIRMS LINE UP FOR OFFSHORE Under the restructuring proposal, KOREA DEVELOPMENT BANK will return to the
BONDS bondholders can exchange existing bonds Samurai market this week after a slew of
at a discount for either cash or their share South Korean yen deals took advantage of
Thirteen Chinese issuers have registered of a total of US$45m zero-coupon unrated improved geopolitical tensions following the
plans to sell offshore bonds with the state senior unsecured notes due August 27 2023 MEETINGûBETWEENû53û0RESIDENTû$ONALDû
PLANNINGûAGENCYûTHEû.ATIONALû$EVELOPMENTû to be issued by RCom’s wholly owned Trump and North Korean leader Kim Jong
and Reform Commission. subsidiary Global Cloud Xchange. Un in June.
4HEû.$2#ûHASûANNOUNCEDûINûTHEûPASTûTWOû The amount in cash has yet to be 3TATE
RUNû+$"ûOFlCIALLYûSTARTEDûMARKETINGû
weeks that the new registrants were determined, but it will be at least 3.5% of a three-year bond last Thursday. Price
YANGZHOU SLENDER WEST LAKE TOURIST DEVELOPMENT face value. guidance was 10bp or 11bp over yen offer-
GROUP, SHANGHAI LINGANG ECONOMIC DEVELOPMENT In May, RCom said it was expected to sell side swaps on Thursday and remained the
(GROUP),NANJING HONG KONG SOURCE INVESTMENT assets totalling Rs181bn to Reliance Jio and same on Friday, well inside the 15bp spread
ADVISORY, CHINA SOUTHERN POWER GRID, POWER #ANADASû"ROOKlELDûAFTERû)NDIASû at which a three-year tranche by Kexim
CONSTRUCTION CORPORATIONOF CHINA, SHANDONG bankruptcy appeals court stopped priced in June. KT and Hyundai Capital
GOLD GROUP, WUHAN FINANCIAL HOLDING (GROUP), insolvency proceedings against the Services have also come to the Samurai
FANTASIA GROUP (CHINA), GANSU PROVINCE ELECTRIC company. market.
POWER INVESTMENT GROUP, LANGFANG HONGTAI The aggressive pricing is being made
INDUSTRIAL TOWN INVESTMENT, MACROLINK HOLDING, possible partly because the size of the
FUYU DEVELOPMENT GROUP and TSINGHUA HOLDINGS. INDONESIA transaction will be somewhat smaller than
4HEû.$2#ûDIDûNOTûSAYûWHENûTHEû the Kexim deal, according to bankers on the
registrations were approved. MODERNLAND REALTY SWOOPS IN FOR transaction. That bond was a ¥120bn
$#-ûBANKERSûNOTEDûTHATûTHEûAGENCYûHADû US$150m (US$1.09bn) dual-trancher, the second-
recently accelerated the pace of approvals largest Asian Samurai after the ¥154.2bn
for offshore bonds across sectors and said MODERNLAND REALTY has priced a US$150m triple-tranche Samurai printed by the
they expected supply from Chinese issuers three-year non-call one bond at 10.75%. Republic of the Philippines earlier this
to rise sharply in September. The Indonesian real estate developer month. The eased tension on the Korean
Separately, Shenzhen-listed Tus-Sound MOVEDûQUICKLYûANNOUNCINGûlNALûGUIDANCEû 0ENINSULAûISûALSOûHELPINGû+$"ûTRYûAûTIGHTERû
%NVIRONMENTALû2ESOURCESûSAIDûINûAûlLINGûLASTû at 10.5%–10.75% last Tuesday morning, a day spread.
week it had registered to issue up to after holding investor calls. +$"ûRATEDû!A!!!û-OODYS302) û
53MûOFûOFFSHOREûBONDSûWITHûTHEû.$2# JGC Ventures will issue the Reg S notes, last tapped the Samurai market in 2014 with
It said its offshore bond quota of US$300m which have expected ratings of B2/B/B. ¥10.1bn of two-year notes and ¥24.8bn of
WOULDûBEûEFFECTIVEûTILLûTHEûENDûOFû$ECEMBER Proceeds will be used to redeem bonds three-year paper.
The issuer of the notes will be Sound maturing in 2019 at a cash price of 102.438 Mitsubishi UFJ Morgan Stanley, Mizuho and
Environment (Hong Kong), it said. plus accrued and unpaid interest, repay Merrill Lynch are the leads on the deal that
Tus-Sound is principally engaged in solid outstanding debt and bank facilities, buy will price on August 28.
waste treatment, municipal water supply land and for general corporate purposes. (See Bonds for coverage of Shinhan’s
and waste water treatment. Standard Chartered and UBSû"$ ûWEREû Australian dollar Tier 2 note.)
joint bookrunners.
MIRAE ASSET DAEWOO EYES DOLLAR
INDIA FIRST
PHILIPPINES
RCOM SELLS Rs20bn OF ASSETS MIRAE ASSET DAEWOO has appointed BNP Paribas,
BPI STARTS INVESTOR MEETINGS Citigroup, Daiwa, HSBC and Mirae Asset
RELIANCE COMMUNICATIONS has completed asset Securities HK for a debut Reg S US dollar bond
sales of Rs20bn (US$285m) to Reliance Jio BANK OF THE PHILIPPINE ISLANDS started
investor some time this year.
ahead of a bondholder meeting on meetings in Singapore and Hong Kong 4HISûISûTHEûlRSTûTIMEûAû3OUTHû+OREANû
elements of the company’s restructuring from August 24 for a potential Reg S dollar SECURITIESûlRMûISûSETûTOûISSUEû53ûDOLLARûBONDSû
plan, according to a release on India’s bond offering, subject to market in public debt markets, according to
exchanges. conditions, according to an exchange Thomson Reuters data.
The assets include 248 media lLING -IRAEû!SSETû$AEWOOûRATEDû"AAûBYû
convergence facilities covering 5m square It has mandated BPI Capital as sole global -OODYSûISûTHEûLARGESTûBROKERAGEûlRMûINû
feet. coordinator and joint bookrunner, with South Korea, with businesses in trading,
Aug 20 2018 China Construction Bank NZ$35m incr Jun 19 2023 4.005 101.445 MS+130 3.673
(NZ) (NZ$135m)
Aug 20 2018 Korea Water Resources SFr200m Sep 20 2023 0.15 100 MS+30 0.15
Aug 20 2018 Perennial Real Estate S$170m Aug 28 2020 5.95 100 SOR+403 5.95
Aug 20 2018 Zhejiang Baron (Hangzhou US200m Aug 27 2021 6.8 100 6.8
Jianggan District
Urban Construction
& Comprehensive
Development)
Aug 20 2018 Singapore US$500m Aug 28 2028 3.875 99.885 T+105 3.889
Telecommunications
Aug 21 2018 Modernland Realty US$150m Aug 30 2021 (2019) 10.75 100 - 10.75
Aug 21 2018 Fufeng Group US$350m Aug 28 2021 5.875 99.886 T+325 5.917
Aug 21 2018 Logan Property US$300m Aug 27 2021 (2020) 7.5 99.342 - 7.75
Aug 23 2018 Mapletree Treasury Services S$300m Aug 30 2026 3.4 100 SOR+105 3.4
“When you look at the levels where some INTENSIlESûFURTHERûANDûTHEûIMPACTûONû LIRA OUTLOOK
banks are trading, it’s still distressed,” he said. 4URKISHûBANKSûINTENSIlES UniCredit analysts said that the lira would
“After the big sell-off and subsequent 4HEûRELATIVELYûSHORT
TERMûMATURITYûPROlLESû remain vulnerable, given the Brunson
bounce, it’s just treading water at levels where of corporate debt could also increase situation and the need for further hikes
you thought you might have seen more pressure on the ratings. from the Turkish central bank.
buying. It shows people are spooked and they “The recent announcement by the Turkish They also think that although actions
aren’t going to be increasing their Turkish Finance Ministry limiting national banks’ from the Turkish regulator such as
exposures. This is going to go on for a while.” ability to cut credit availability to corporates is restricting trading in the offshore market
Most of the country’s short-term positive for the corporate sector in the short will inhibit short-selling, they send the
external debt of US$180bn is within the term in terms of availability, but, in the long wrong message to investors.
PRIVATEûSECTORûWITHûlNANCIALSûACCOUNTINGû term, could potentially increase risks for the h3PECIlCALLYûBYûRESTRICTINGûAûHEDGINGûTOOLû
for US$83bn and corporates US$65bn, banking sector,” said Fitch analysts. investors may ultimately have to cut their
according to Societe Generale analysts. “Past experience would suggest that whilst portfolio holdings,” said UniCredit analysts.
However 90% of that short-term debt short-term availability might be assured, “Ultimately, the correct policy measures,
comes in the form of instruments other pricing for corporates will likely increase. In INCLUDINGûlSCALûANDûMONETARYûTIGHTENINGû
than bonds, according to SG calculations, the longer term, weakness in the banking would be a prerequisite for any lira recovery,
such as bank loans and trade credits. system would impact the corporates relying EVENûWITHûANûEXTERNALûlNANCINGûhANCHORvû
Indeed, there’s only US$3.8bn of foreign on banking credit or deposits placed with coming from funding from Qatar. Ideally, a
currency-denominated bonds maturing by banks for their liquidity needs and also MOREûSUBSTANTIALûEXTERNALûlNANCINGûSUPPORTû
the end of the year. increase the macro risks in the country.” that comes on the condition of undertaking
“The banks are very well capitalised and The ratings agency has downgraded food correct macro policies (such as an IMF
well managed,” said the banker. “The view is group Yasar (B–) and retailer Migros (A+) by programme) may be required to turn the
they can withstand the current situation but one notch. fortunes of the currency.”
another big loss in the lira and things will
look uglier. Then it moves from a capital ALL INTL EMERGING MARKETS BONDS ALL INTL EMERGING MARKETS BONDS
issue to one of NPLs.” BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Europe/Africa Managing No of Total Share
FITCH ON CORPORATES Managing No of Total Share bank or group issues US$(m) (%)
Fitch published a report stating that bank or group issues US$(m) (%) 1 Citigroup 159 37,172.12 9.5
currency mismatches and a reliance on 1 Citigroup 30 9,612.07 14.5 2 HSBC 195 30,960.12 7.9
short-term borrowing were exacerbating the 2 JP Morgan 27 7,051.85 10.6 3 JP Morgan 98 23,500.30 6.0
pressure on Turkish corporate ratings that 3 Deutsche Bank 16 5,703.42 8.6 4 Standard Chartered 128 20,554.01 5.3
were coming from a depreciating lira and a 4 VTB Capital 11 5,157.69 7.8 5 Deutsche Bank 76 20,529.84 5.3
deteriorating operating environment. 5 HSBC 14 4,033.64 6.1 6 BNP Paribas 93 14,509.45 3.7
The ratings agency said that the liquidity 6 Standard Chartered 9 4,004.97 6.0 7 BAML 73 13,553.90 3.5
PROlLESûFORûCORPORATESûBECOMEûINCREASINGLYû 7 BNP Paribas 14 3,142.45 4.7 8 Goldman Sachs 46 11,898.54 3.0
SIGNIlCANTûIFûVOLATILEûCONDITIONSûPERSISTûOVERûTIME 8 Goldman Sachs 7 2,709.87 4.1 9 Morgan Stanley 60 11,284.60 2.9
Turkish corporates rely on uncommitted 9 SG 13 2,578.20 3.9 10 Barclays 50 11,146.35 2.9
bank credit lines, and although Fitch says 10 Barclays 5 1,868.96 2.8 Total 654 390,999.00
that to date the companies have been able to Total 70 66,251.74 Excluding equity-related debt.
become more restricted if the currency crisis Source: Thomson Reuters SDC code: L2 Source: Thomson Reuters SDC code: L1
- - - A1/A CBA -
- - - -/AA UBS -
6% area - - Unrated DBS/OBCB/UOB -
6.8% (#) - - unrated Guotai Junan -
T+125 area - >US$2.85bn A1/A+ DBS/Citi/HSBC Asia 88%, Europe 12%, FM 56%, Bks
30%, Ins 10%, PB 4%
10.5%/10.75% - - B2/B/B StCh/UBS -
T+345 area - >US1bn -/BBB- DB/HSBC/UBS/BOC HK/China Asia 82%, Eur 8%, AM/FM 76%, Ins 17%,
Minsheng HK/Guotai Junan Haitong/ Bks 5%, PB 2%
Mason Secs/Miz
High 7% area - US$590m -/B+ Guotai Junan/DB/HSBC/SPDB/ Asia 92%, EMEA 8%, AM/FM 58%, Bks
CMBC 32%, PB 10%
3.45% area - - Unrated DBS Sing 99.9%, HK 0.1%, FM/Ins 70%, Bks/
Agency 15%, PB 15%
11% (#) - -/B/B CS/BOCI/Orient/VTB/Tensant -
- - - Baa1/BBB+/BBB+ ANZ/BNPP -
still has some US$2.3bn of principal falling Source: Thomson Reuters SDC code: L5 Source: Thomson Reuters SDC code: L3
2017
2010
2011
2015
2009
2008
2014
2016
2018 ytd
2013
2012
beginning of June. Italian bond yields spiked, Moody’s has placed Atlantia on review for
eroding banks’ capital buffers. downgrade, while S&P put the ratings on
Credit Default Swaps rates – which are a CreditWatch negative.
proxy for banks internal funding costs – for Source: Thomson Reuters LPC Alasdair Reilly
Oil and gas producer SANTOS is borrowing The acquisition financing for Indonesia’s ADARO US$250m revolver and a US$400m mezz piece.
53BNûINûAûDUAL
TRANCHEûLOANûTOûlNANCEû ENERGY and Australian private equity firm EMR MUFG and StanChart had committed to
ITSûPROPOSEDûACQUISITIONûOFûPRIVATELYûHELDû Capital’s purchase of Rio Tinto’s Kestrel coal provide the US$400m bridge, while ANZ, CIMB,
Quadrant Energy. mine has closed at a reduced size of US$1.69bn, DBS, MUFG, OCBC, StanChart and SMBC had
4HEûLOANûISûSPLITûEQUALLYûBETWEENûAû
with 14 lenders participating in the senior debt underwritten the US$1.05bn term loan. Four of
year portion and a two-year bridge facility portion and a South Korean financial institution the seven lenders on the term loan were also
that will be taken out upon completion of providing the mezzanine piece. providing the US$250m revolver. Nomura and
THEûACQUISITION The financing has a US$1.364bn five-year Varde Partners were committed to provide the
Santos said the purchase of Quadrant for senior loan and a US$325m subordinated US$400m junior loan at the holding-company
at least US$2.15bn will also be funded by piece. The senior debt is split into a US$1.16bn level. The mezz portion was structured as a pay-
cash along with the US$1.2bn loan. Santos amortising term loan, a US$150m revolving in-kind note issue, yielding well over 10%.
had US$1.5bn in cash on hand as at June 30. credit facility and a US$54m bonding facility
Santos said it intends to maintain a strong comprising unfunded environmental bonds. MITSUI CHANGES TACK
lNANCIALûPROlLEûCONSISTENTûWITHûANû ANZ, CIMB Bank, DBS Bank, MUFG, OCBC As the acquisition progressed, Japanese trading
investment-grade rating. Net gearing is Bank, Standard Chartered and SMBC were the house Mitsui & Co decided to retain its 20%
expected to be around 34% at year-end 2018 mandated lead arrangers and bookrunners of stake in the Kestrel coal mine, thereby reducing
and to decline to less than 30% by the end of the senior loan, which pays an interest margin the funding need for Adaro and EMR. Moreover,
2019. Santos also intends to maintain of 375bp over Libor. Bank Mandiri, BNP Paribas, strong demand from Asian lenders saw the more
AVAILABLEûLIQUIDITYûINûEXCESSûOFû53BN HSBC, ING Bank and National Australia Bank expensive bridge being cancelled and the term
4HEûACQUISITIONûISûALSOûSUBJECTûTOûPOTENTIALû joined as MLAs, while CTBC Bank and Westpac loan, revolver and the mezz piece being cut in size.
additional contingent payments. came in as lead arrangers. The acquisition of Rio Tinto’s stake was
The deal comes soon after Quadrant and South Korea’s Meritz Securities provided the completed earlier this month, with the senior
junior joint venture partner Carnarvon US$325m mezz loan, which also has a five-year loan being signed on July 19.
Petroleum reported what the latter called a maturity and pays an interest rate of around 12%. With the sale of its stake in the Kestrel mine, Rio
“truly incredible” oil discovery, sending The overall financing is significantly smaller Tinto has now exited the coal industry. The deal
Carnarvon’s shares rocketing to a nine-year than the US$2.1bn borrowing the acquirers eyed marks Adaro’s biggest overseas investment and the
high. a few months ago. Adaro and EMR agreed in late biggest mining investment for Australia-based EMR.
Santos said the deal could potentially March to buy an 80% stake in Rio Tinto’s Kestrel The Kestrel mine, located in the Bowen Basin
boost its annual production by about coking coal mine for A$2.25bn (US$1.64bn) region, produces high-quality coking coal for
32%. and had looked at a combination of senior and steel manufacturing. It has significant reserves
"ROOKlELDû!SSETû-ANAGEMENTûOWNSûAûû mezz loans for up to US$2.1bn. At the time, of 146m tons and is in the lowest-cost quartile of
STAKEûINû1UADRANTûWHILEû-ACQUARIEû'ROUPû the financing included a US$1.05bn term loan, comparable mines.
retail conglomerate Wesfarmers and mining a US$400m bridge-to-high-yield bond, a Prakash Chakravarti
heiress Angela Bennett are also
shareholders, Reuters reported.
Wesfarmers said in a separate statement The bullet loan is the second sole
on Wednesday that it would be selling its mandate for MUFG from an Australian CHINA
13.2% stake in Quadrant for US$170m. utility company.
Earlier in the year, Santos was the target In late July, MUFG launched a A$250m CIRO’S PLAZA BUILDS US$325m REFI
of a leveraged buyout after receiving a seven-year facility for ENDEAVOUR ENERGY.
US$10.4bn takeover bid from US private That bullet loan offers top-level all-in Ciro’s Plaza, a commercial complex in
EQUITYûlRMû(ARBOURû%NERGYû*0û-ORGANûANDû pricing of 132.86bp based on an interest Shanghai’s Huangpu district, is seeking a
Morgan Stanley had underwritten a margin of 120bp over BBSY. 53M
EQUIVALENTûTHREE
YEARûTERMûLOAN
53BNûDEBTûlNANCINGûBACKINGûTHEû Alinta Energy last tapped the loan Standard Chartered is the mandated lead
buyout. However, in late May Santos market in late 2017 for a A$715m arranger and bookrunner of the transaction,
rebuffed Harbour Energy’s sixth offer in lVE
YEARûFACILITYûTHATûBACKEDûITSû which comprises a Rmb513m (US$75m)
nine months, worth up to A$7.00 (US$5.13) ACQUISITIONûOFûTHEû,OYû9ANGû"ûPOWERû onshore tranche and a US$250m offshore
a share. plant in Australia from Engie SA and portion.
Mitsui & Co. That deal comprised a The interest margins are 121% of the PBoC
ALINTA SEEKS SEVEN-YEAR MONEY A$50m revolving credit tranche for rate on the onshore piece and 205bp over
capital expenditure, a A$15m revolving Libor on the offshore portion.
ALINTA ENERGYis in the market for a A$200m working capital tranche and a Banks are being invited to join as MLAs with
(US$147m) seven-year loan mandated to A$650m term loan tranche. The 53M
EQUIVALENTûORûABOVEûFORûALL
INûPRICINGû
MUFG. margin is 235bp over BBSY and of 127% of the PBoC rate or 240bp over Libor
Funds are for general corporate the commitment fee is 40% of the via participation fees of 90bp or 105bp for the
purposes. margin. onshore and offshore tranches, respectively.
SOFTBANK CORP is inviting existing lenders to its 80bp, 125bp, 160bp and 175bp over Tibor, LISTING ON CARDS
latest ¥1.6trn (US$14.37bn) six-year senior term respectively. The margins were tied to SoftBank In May, SoftBank Group won approval from
loan. Group’s Ba1/BB+ (Moody’s/S&P) ratings, which lenders on its ¥2.65trn loan to release the
The loan already has five banks at the remain unchanged. guarantee from its mobile phone unit as the
top, with Sumitomo Mitsui Trust Bank also a Mizuho was the original MLA and bookrunner, latter prepared to list its shares. SoftBank
mandated lead arranger along with Credit while Credit Agricole, MUFG and SMBC joined Corp made a preliminary application last
Agricole, Mizuho Bank, MUFG and SMBC. on a take-and-hold basis. Another 21 lenders month to list its shares on the Tokyo Stock
The loan, which was signed on Thursday, is to joined the deal in senior syndication. Exchange.
partially refinance a mammoth financing raised The 2017 loan had refinanced a ¥1trn two- The consent from lenders will become effective
last November for the mobile phone operator’s year bridge facility signed in September 2016 if the TSE approves the listing of SoftBank Corp.
parent company. Drawdown is slated to take for SoftBank Group’s £24.3bn (US$32bn SoftBank Group said that all other guarantees
place on August 31. then) purchase of UK chip designer ARM from SoftBank Corp to the parent’s other
The latest loan refinances part of SoftBank Holdings, an acquisition financing that loans and unsecured straight corporate bonds,
Group’s ¥2.65trn four-tranche financing, which backed SoftBank Group’s US$1.26bn including yen and foreign currency-denominated
comprises a ¥650bn three-year term loan, a purchase of a 57% stake in US cellphone bonds, will also be released successively. As a
¥600bn five-year term loan, a ¥1.1trn seven-year distributor Brightstar Corp in 2013, and result, all of SoftBank Group’s liabilities will not
term loan and a ¥250bn seven-year working part of a ¥1.98trn financing completed in have guarantees.
capital facility. They pay interest margins of September 2013. Wakako Sato
Bank Sinopac, Jih Sun International Bank and average life. Source: Thomson Reuters SDC code: R17
TRAILSTONE SIGNS US$125m REFI The loan pays a margin based on the A 50bp fee on outstanding loans is due 90
Canadian dollar offered rate or the Canadian days after closing, 75bp is due 180 days after
Commodity trading company TRAILSTONE GROUP prime rate. closing and 100bp is due 270 days after
has signed a US$125m one-year European For a rating of A-/A3 it pays 87.5bp/0.0bp closing.
BORROWINGûBASEûFACILITYûRElNANCINGûITSû over the Canadian dollar offered rate/ There is also an 11bp ticking fee on
existing US$232m European credit facility Canadian prime rate for up to 89 days, unfunded commitments.
which was agreed in August 2017. 112.5bp/12.5bp for 90-179 days, Constellation’s increased investment in
4HEûFACILITYûISûUSEDûTOûlNANCEû4RAIL3TONESû 137.5bp/37.5bp for 180-269 days and Canopy Growth, which is expected to close
working capital in its European gas and 162.5bp/62.5bp thereafter. by the end of October, will bring
power business. For BBB+/Baa1 it pays 100bp/0.0bp for up Constellation’s ownership up to around 38%.
4HEûlNANCINGûWASûARRANGEDûBYûING as to 89 days, 125bp/25bp for 90-179 days,
bookrunning mandated lead arranger and BNP 150bp/50bp for 180-269 days and
Paribas as mandated lead arranger. Societe 175bp/75bp thereafter.
Generale was lead arranger, while Citigroup, For BBB/Baa2 it pays 112.5bp/12.5bp for up
Credit Suisse, GarantiBank and Natixis were to 89 days, 137.5bp/37.5bp for 90-179 days, LATIN AMERICA
arrangers. 162.5bp/62.5bp for 180-269 days and
ING is also facility agent. 187.5bp/87.5bp thereafter.
TrailStone’s debut US$200m, one-year For BBB-/Baa3 it pays 125bp/25bp for up to 89 CHILE
European facility was arranged in August 2016 days, 150bp/50bp for 90-179 days, 175bp/75bp
and was replaced in August 2017 with a for 180-269 days and 200bp/100bp thereafter. LATAM AIRLINES WRAPS US$302m DEAL
US$232m facility, also coordinated by ING Bank. For BB+/Ba1 it pays 150bp/50bp for up to
4HATûlNANCINGûWASûFORû4RAIL3TONEû5+ûANDû 89 days, 175bp/75bp for 90-179 days, LATAM AIRLINES GROUP has closed a US$302m
TrailStone GmbH, guaranteed by TrailStone 200bp/100bp for 180-269 days and syndicated loan backing a portfolio of 32
(Cayman) LP and TrailStone LP. 225bp/125bp thereafter. aircraft.
BNP Paribas, Citigroup, HSBC, Natixis,
2ABOBANKûANDû3OCIETEû'ENERALEûRElNANCEDû
their existing participation, while
GarantiBank joined as a new lender.
Comcast partially repays
ING Bank was security agent and fronting
bank, while Rabobank was facility agent.
4RAIL3TONEûHASûOFlCESûINû!USTINû.EWû9ORKû
£16bn bridge
London and Berlin. US Media giant extends acceptance period for Sky’s bid
Source: Thomson Reuters SDC code: P2 Source: Thomson Reuters SDC code: P10 Source: Thomson Reuters SDC code: P13
The competitive dynamics that have defined US leverage in order to hold on to mandates and M&A activity is expected to dominate, as
middle market lending this year are expected portfolio assets. many of the deals that could be refinanced and
to persist after Labor Day, as the market gears One incumbent lender inked an all-senior repriced were done earlier in the year.
up and lenders and investors battle to win deal with 7.25 times total leverage at pricing There is plenty of sponsor capital to invest and
mandates and hold on to existing portfolio of 525bp over Libor recently, the first investor sellers are trying to evaluate those opportunities,
assets. said. Existing lenders were unable to join the a third middle market lender said. “Generally
Middle market lenders are optimistic that deal new deal at that price, but the lender held the speaking there is a clear runway for the back
flow will pick up again in September after a lull entire transaction and brought in only one third of the year.”
in the second half of August, when few deals participant. There could be a pause in supply around the
launched. Lenders and investors are preparing to “If you know a business and know it well, you November mid-term elections as sponsors and
work aggressively to win those deals and protect are willing to defend your portfolio,” the first issuers wait to see what a possible change in
existing assets and incumbent arranging positions. investor said. control in the House of Representatives could
“Everybody wants to be a lead. That’s how Existing platforms are also continuing to build mean from a policy perspective.
you control your destiny and make your shop out teams to expand direct lending offerings and Demand is expected to remain strong as
significant and relevant to sponsors,” a middle new platforms still being formed, which means excess capital seeks high quality paper. “High
market investor said, adding that the ability to appetite is not waning as yet. quality deals remain highly sought after,” the
commit capital and hold in size is critical. Earlier this summer, Alcentra, an alternative second lender said.
Intensifying competition amid an influx of fixed income specialist for BNY Mellon Pricing has mostly stabilised compared
capital has seen middle market lending move Investment Management, announced the with earlier in the year, as traditional middle
away from syndicated deals towards club deals expansion of its US direct lending team, bringing market lenders have held the line at 400bp over
that only require a handful of investors, which on board Suhail Shaikh and Peter Glaser as Libor for a first-lien institutional term loan, but
means that capital providers need to be the first managing directors and co-heads of US direct spreads could potentially go lower if demand
call for sponsors. lending based in New York. ramps up even further.
In the first half of this year, twice as many Middle market institutional term loans
middle market buyouts were financed by direct OUTLOOK BRIGHT are yielding 7.06% so far in the third quarter,
lenders as traditional syndicated loans, LPC data Middle market sponsored volume for syndicated up from 6.64% in the second quarter and
show. and direct lending of US$95.5bn in the first half significantly higher than the 5.95% seen in the
“If a sponsor takes three lenders to the dance, of 2018 is on track to top 2017’s combined tally third period of last year.
you want to be in that rotation,” a second middle of US$151bn, the data show. Despite improving yields, market participants
market investor said. Optimistic market participants expect a would not object to some volatility to take the
This dynamic, combined with a borrowers’ steady flow of deals in September, as a benign heat out of the market.
market where demand exceeds supply, naturally macroeconomic environment and solid demand “The market is waiting for a speedbump,” the
benefits larger, more established platforms from private equity buyers contribute to healthy second lender said, “though not a pothole.”
that can compete more aggressively on price or pipelines. Leela Parker Deo
Weatherford agreed a US$1.65bn loan The company’s €348m Term Loan B was Parfuemerie Akzente generated net sales
RElNANCINGûINû-AYûûVIAûBOOKRUNNERSû*0û bid at an average of 85.25 on Thursday, after of around €75m in 2017.
Morgan, Citigroup, Deutsche Bank, Morgan dropping below 90 on July 4.
Stanley, MUFG, and Wells Fargo. This is 14.89% off the loan’s highest
Participants were SEB, Toronto Dominion secondary price of 100.19 on January 24. The ASIA-PACIFIC
Bank, Royal Bank of Canada, Standard loan fell below par or face value on February 9.
Chartered Bank, Barclays Bank, Nordea The decline has brought mark to market NATURE’S CARE CLOSES A$280m LBO
Bank, UniCredit Bank, BBVA and Arab losses for some investors, although one LOAN
Banking Corp. investor viewed the current price as
4HEûlNANCINGûCOMPRISEDûAû53BNû oversold. 4HEû!MûlVE
YEARûAMORTISINGûLOANû
three-year revolving credit facility and a “The problem is that investors obviously backing a Chinese state-backed
US$500m, four-year secured term loan. don’t want to try and catch a falling knife,” consortium’s buyout of Australia’s NATURE’S
he said. CARE MANUFACTURE has closed after attracting
DOUGLAS TO RELEASE DELAYED RESULTS Douglas reported Ebitda of €199m for the 10 banks in general syndication.
six months to March 31. CVC bought Douglas Standard Chartered and UOB Bank were the
German beauty retailer DOUGLAS will release from Advent in 2015 for around €3bn. mandated lead arrangers and bookrunners
ITSûlNANCIALûRESULTSûONû!UGUSTûûAFTERûAû 4HEûCOMPANYûCOMPLETEDûTHEûACQUISITIONû on the facility, which has an interest
previous delay hit the secondary prices of its of a majority stake in Parfuemerie Akzente margin of 330bp over BBSY calculated on
loans and bonds in early July. on August 16, which owns the online shop an average life of 4.55 years. The loan
)NVESTORSûSAIDûTHATûQUESTIONSûREMAINûOVERû parfumdreams. amortises by 5% every year with a bullet
the retailer’s domestic performance, as 4HEûACQUISITIONûEXPANDSû$OUGLASSû repayment at maturity and covenants
European retailers continue to face stiff E
COMMERCEûBUSINESSûANDûWILLûBEûlNANCEDû include a maximum net leverage covenant
online competition. BYû$OUGLASûFROMûOPERATINGûCASHmOW of 5 times earnings.
€623
SHARES IN DUTCH PAYMENTS FIRM
CEO of the waste management and
RECYCLINGûCOMPANYû$ANIELû4ARTAKûHASû
committed to take up all of his entitlement
under the placement will be settled on
August 30.
CitigroupûISûTHEûLEADûMANAGERûOFûTHEûmOAT
ADYEN CLIMBED MORE THAN 10% OVER OFû!Mû"INGOûFOUNDERû4ONYû4ARTAKûANDû
TWO DAYS FOLLOWING THE RELEASE Mark Tartak each took up A$9m of the offer. PHC SECURES STRONG BACKING
OF DEBUT RESULTS, HITTING A NEW 4HEûWASTEûMANAGEMENTûANDûRECYCLINGû
INTRADAY HIGH OF €623 ON THURSDAY COMPANYûEXPECTSûTOûRAISEûABOUTû!Mû PRIMARY HEALTH CARE has raised A$157m
AND CLOSING ABOVE €600 FOR THE FIRST through the underwritten retail portion of 53M ûFROMûTHEûINSTITUTIONALûTRANCHEûOFû
TIME THE SAME DAY AT €607.20. THE IPO the offering, which runs from August 28 to AûROUGHLYû!MûENTITLEMENTûOFFER
PRICED AT €240 PER SHARE, WITH BUYERS 3EPTEMBERûûACCORDINGûTOûAûCOMPANYû Eligible shareholders took up 99% of their
IN THE FLOAT NOW SITTING ON OVER 150% statement. entitlements, and the shortfall from
PROFIT IN A LITTLE OVER TWO MONTHS 4HEûCOMPANYûLAUNCHEDûTHEûENTITLEMENTû ineligible investors and renounced rights
OFFERûOFûMûNEWûSHARESûATû!ûEACHûONûAû received strong demand from both existing
989
UK LUXURY FASHION WEBSITE
1-for-2.48 basis. The price represents an 11.4%
discount to the pre-deal spot of A$2.87.
Most of the proceeds will be used to fund
shareholders and other institutional
investors.
0RIMARYûEXPECTSûTOûRAISEûABOUTû!Mû
FARFETCH BRINGS TOGETHER 989 THEûACQUISITIONûOFû3YDNEY
BASEDû$IALûAû$UMPû through the retail portion of the offering,
SELLERS ON ITS PLATFORM TO SERVE 2.3m Industries, and the remainder for the which runs from August 27 to September 7.
CUSTOMERS. FOR ITS US IPO, THE LOSS- purchase of two properties in Melbourne 4HEûCOMPANYûLAUNCHEDûTHEûENTITLEMENTû
MAKING COMPANY IS PITCHING ITSELF ANDû3YDNEY offer of 100m new shares at A$2.50 each on
AS A TECHNOLOGY INVESTMENT RATHER Bingo will acquire DADI for A$577.5m, a 1-for-5.21 basis. The price represents a
THAN A RETAILER. GROSS PROFITS ARE with A$377.5m paid in cash and A$200m in 17.8% discount to the pre-deal spot.
GROWING QUICKLY BUT SO ARE NET CASH Bingo shares. The proceeds will be used to expand the
OUTFLOWS AND IN THE FIRST HALF IT Goldman Sachs and UBS are the COMPANYSûMEDICALûCENTRESûWITHûADDITIONALû
RECORDED AN EBITDA LOSS OF US$49.1m underwriters of the entitlement offer. services and new staff, as well as to develop
PATHOLOGYûINFRASTRUCTURE
21.5%
US IPOs FOR THE YEAR TO-DATE, AS OF
AFTERPAY TOUCH LAUNCHES PLACEMENT
Two weeks
MORGAN STANLEY SOLD SHARES IN
5 BAML
6 CICC
7 Credit Suisse
19
19
33
7,374.32
7,208.32 4.6
5,478.89 3.5
4.7 5 CICC
6 BAML
7 Citic
19
16
36
7,208.32
6,780.17 4.8
5,407.09 3.8
5.1
CLINICAL RESEARCH ORGANISATION 8 Citic 36 5,407.09 3.4 8 Credit Suisse 32 5,305.76 3.8
MEDPACE LAST WEEK AT US$55.50 APIECE 9 JP Morgan 34 5,347.69 3.4 9 JP Morgan 30 4,577.75 3.2
MARKING THE EXIT OF SPONSOR CINVEN. 10 Sumitomo Mitsui Finl 48 3,543.74 2.2 10 Guotai Junan Securities 23 3,442.53 2.4
JUST TWO WEEKS EARLIER MORGAN Total 1,574 158,052.71 Total 1,433 141,426.33
STANLEY SOLD SHARES IN THE COMPANY Including all domestic and international deals and rights issues Including all domestic and international deals and rights issues
ON BEHALF OF THE SAME SELLER Source: Thomson Reuters SDC code: C4a1 Source: Thomson Reuters SDC code: C4a2
Its shares were trading at A$2.83 last application with the Stock Exchange of US$300m, according to three people with
7EDNESDAYûMORNINGûDOWNûû4HEûSTOCKû (ONGû+ONGûBYûTHEûENDûOFûTHISûMONTHûFORûANû direct knowledge of the matter.
ISûDOWNûûSOûFARûTHISûYEAR IPO that could raise about US$800m–$1bn, CMIG FUTURELIFEûTHEûPROPERTYûMANAGEMENTû
Morgan Stanley and UBS are the joint according to people close to the deal. UNITûHASûRECENTLYûMETûWITHûBANKSûTOûDISCUSSû
underwriters for the deal. Bank of America Merrill Lynch and Morgan a potential listing, said the people.
Stanley are leading the transaction. #-)'û&UTURELIFEûSAIDûWHENûCONTACTEDûBYû
-AOYANûWASûVALUEDûATû2MBBNû )&2ûTHATûITûCURRENTLYûDOESûNOTûHAVEûPLANSûTOû
CHINA 53BN ûLASTû.OVEMBERûWHENûINTERNETû LISTûINû(ONGû+ONG
GIANTû4ENCENTû(OLDINGSûMADEûAû2MBBNû CMIG Futurelife would be joining a wave
MEITUAN DIANPING TO PRE-MARKET IPO INVESTMENTûINûTHEûCOMPANYûACCORDINGûTOûAû OFû#HINESEûPROPERTYûMANAGEMENTûCOMPANYû
Reuters report. LISTINGSûINûTHEûCITY
MEITUAN DIANPING, one of China’s most 4HEûINVESTMENTûCAMEûAFTERû-AOYANûANDû !
,IVINGû3ERVICESûTHEûPROPERTYû
valuable internet companies, is planning to 4ENCENT
BACKEDû"EIJINGû7EIYINGû4ECHNOLOGYû management unit of developer Agile, raised
STARTûPRE
MARKETINGûAûPROPOSEDûmOATûOFûATû struck a merger deal in September to create (+BNû53M ûFROMûANû)0/ûINû
least US$4bn this week. AûlLMûTICKETINGûGIANT &EBRUARYû)Nû*UNEû#OUNTRYû'ARDENûALSOû
Books are scheduled to open on -AOYANû7EYINGSûOTHERûBACKERSûINCLUDEû LISTEDû#OUNTRYû'ARDENû3ERVICESûINû(ONGû
September 3 ahead of a listing on 3HENZHEN
LISTEDûlLMûPRODUCERû"EIJINGû +ONGûBYûINTRODUCTION
September 20, according to people close to Enlight Media and Meituan Dianping, +AISAû'ROUPûINû*UNEûANNOUNCEDûPLANSûTOû
the deal. Pricing is set for September 12. China’s largest provider of on-demand SPINûOFFûITSûPROPERTYûMANAGEMENTûUNITû+AISAû
%ARLYûFEEDBACKûFROMûINVESTORSûVALUEDûTHEû online services, which is about to launch its 0ROPERTYûINû(ONGû+ONGû4HEûDEALûISûEXPECTEDû
COMPANYûATûAROUNDû53BNnBNûTHEûPEOPLEû own IPO. to raise about US$100m, said people close to
SAIDû$EPENDINGûONûlNALûPRICINGûANDûTHEûSIZEûOFû China is the world’s second-largest the plan.
THEûmOATû-EITUANSû)0/ûCOULDûRIVALû8IAOMISû CINEMAûMARKETûANDûNEARLYûûOFûlLM
GOERSû
53BNû*ULYûLISTINGûASûTHEûWORLDSûBIGGESTûTECHû BUYûTICKETSûONLINEû2EUTERSûHASûREPORTEDû QUTOUTIAO FILES FOR NASDAQ IPO
mOATûSINCEû!LIBABAûWENTûPUBLICûINû citing Big Data Research.
-EITUANû$IANPINGûBACKEDûBYû#HINESEû Chinese news aggregator QUTOUTIAO, which
TECHûGIANTû4ENCENTû(OLDINGSûRUNSûAûRANGEûOFû TIANQI FILES FOR HONG KONG FLOAT COUNTSûINTERNETûGIANTû4ENCENTû(OLDINGSûASûAû
ONLINEûBUSINESSESûSPANNINGûFOODûDELIVERYûTOû SHAREHOLDERûHASûlLEDûFORûAû53Mû.ASDAQû
ticketing services in China. Shenzhen-listed TIANQI LITHIUMûHASûlLEDûANû IPO.
Bank of America Merrill Lynch, Goldman Sachs APPLICATIONûFORûAû(ONGû+ONGû)0/ûTHATûCOULDû 0RE
MARKETINGûSTARTEDûLASTû-ONDAYû
and Morgan Stanley are joint sponsors for the raise up to US$1bn. according to a person close to the deal.
deal. China RenaissanceûISûTHEûlNANCIALû The world’s second-largest lithium Qutoutiao, which means “fun headlines”
adviser. PRODUCERûBYûSALESûISûSETûTOûBEûTHEûCITYSû in Chinese, allows users to create
second listing of a lithium producer this customised feeds of articles and short videos
TENCENT MUSIC AIMS FOR OCTOBER IPO YEARûASû3HENZHEN
LISTEDû'ANFENGû,ITHIUMû FROMûTHIRD
PARTYûSOURCESû!SûOFû*ULYûITûHADû
ALSOûPLANSûAûmOATûOFûUPûTOû53BNûINû MûMONTHLYûACTIVEûUSERSûANDûMûDAILYû
TENCENT MUSIC ENTERTAINMENT, China’s largest September. active users who spent 55 minutes on
MUSIC
STREAMINGûCOMPANYûPLANSûTOûSTARTûPRE
4HEûlNALûDEALûSIZEûOFû4IANQIûCOULDûBEû AVERAGEûONûTHEûAPPûPERûDAY
marketing a US IPO of about US$3bn–$4bn in smaller than US$1bn because of a steep drop ,AUNCHEDûINû*UNEûû1UTOUTIAOûHASû
late September ahead of a listing in October, in lithium carbonate prices, people close to TRIEDûTOûSTANDûOUTûFROMûTHEûCROWDûBYûOFFERINGû
according to people close to the deal. the deal said. DIGITALûCOINSûTOûUSERSûWHENûTHEYûREGISTERû
!Tû53BNû4ENCENTû-USICSûmOATûISûSETûTOû CLSA and Morgan Stanley are joint sponsors check in, invite friends and read and share
be the biggest Chinese listing in the US of the listing. news. The coins are convertible into
since the US$25bn IPO of Chinese Tianqi’s proposed listing comes after its RENMINBIûATûAûRATEûTHATûmUCTUATESûACCORDINGû
e-commerce giant Alibaba in September BLOCKBUSTERû53BNûDEALûINû-AYûTOûBUYûAû to the level of advertising revenues.
2014. It will also be the biggest US IPO this ûSTAKEûINû#HILESû3OCIEDADû1UIMICAûYû 4HEûCOMPANYûPOSTEDûAûNETûLOSSûOFû
YEARûSURPASSINGûTHEû53BNû)0/ûOFû!8!û Minera. 2MBMû53M ûFORûTHEûlRSTûSIXûMONTHSû
%QUITABLEûINû-AY 4HEûMAJORITYûOFû4IANQISûLISTINGûPROCEEDSû THISûYEARû)TûLOSTû2MBMûDURINGûTHEûWHOLEû
)Nû*ULYû(ONGû+ONG
LISTEDû4ENCENTû WILLûBEûUSEDûFORûRElNANCINGûTHEû31-ûSTAKEû OFûûANDû2MBMûINû
(OLDINGSûSAIDûITûHADûRECEIVEDûAPPROVALûFROMû purchase, according to the draft prospectus. Co-founders Eric Siliang Tan and Lei Li
THEû3TOCKû%XCHANGEûOFû(ONGû+ONGûTOûSPINûOFFû 4HEûCOMPANYûPOSTEDûAûûJUMPûINû RESPECTIVELYûOWNûûANDûûINûTHEû
its online music entertainment business and annual revenues in 2017 to Rmb5.47bn COMPANYû4ENCENTûWHICHûINVESTEDûVIAûAû
would list Tencent Music in the US. 53M û)TûREPORTEDû2MBBNûINûPROlTû venture capital round, has a 7.8% stake.
Bank of America Merrill Lynch, Deutsche Bank, ALMOSTûDOUBLEûTHATûOFû Citigroup, CMS, Deutsche Bank and UBS are
Goldman Sachs, JP Morgan and Morgan Stanley Tianqi, whose shares have almost halved THEûLEADSûOFûTHEûmOAT
will lead the IPO. from a peak of Rmb73.39 in September last
Tencent Music was valued at around YEARûMAKESûAûVARIETYûOFûRAWûMATERIALSûFORû ASIAINFO FILES US$400m HK IPO
53BNûINûLATEûûWHENû3POTIFYûSWAPPEDû THEûBATTERYûINDUSTRY
AûSTAKEûWITHûITû)TûISûCURRENTLYûVALUEDûATûABOUTû ASIAINFO HOLDINGS,
a Chinese provider of
US$25bn–$30bn in the private markets. CMIG TO LIST UNIT IN HONG KONG TELECOMSûSOFTWAREûSERVICESûHASûlLEDûFORûAû
(ONGû+ONGû)0/ûOFûABOUTû53MnMûAû
MAOYAN WEYING GETS CLOSER China Minsheng Investment Group, one of PERSONûWITHûKNOWLEDGEûOFûTHEûmOATûHASûSAID
China’s largest private investment funds, is 4HEûCOMPANYûLISTEDûONû.ASDAQûINûû
MAOYAN WEYING, China’s biggest online seller PLANNINGûTOûLISTûITSûPROPERTYûMANAGEMENTû ANDûWASûTAKENûPRIVATEûBYûAû#ITICû#APITAL
LEDû
OFûlLMûTICKETSûPLANSûTOûlLEûAûLISTINGû UNITûNEXTûYEARûINû(ONGû+ONGûTOûRAISEûUPûTOû consortium in 2014.
The first snapshot of a company’s financial followed a similar upward path. Its second day Chief executive Vincent Steckler is one of the
health after a flotation is highly anticipated by of trading closed at SFr62, 29% above its SFr48 few executives to welcome the rise of high-level
new and old shareholders alike. But one thing pricing level. Shares closed on August 21 at cyber breaches.
they probably don’t want to hear much about SFr72.20. “Legislation and high-profile data breaches
is IPO fees, which can be a convenient way for Although it dodged losses, Medartis’ interim have led to an increased focus on privacy
companies to distract from a less-than-stellar results show a 64.8% fall in operating profit concerns and security risks amongst both
financial performance. in the first six months of the year compared consumer and business customers,” he said in
Wednesday marked the first set of results to last, with IPO costs bringing profit down to a statement, “Avast is set to capitalise on these
from four recent IPOs that have experienced SFr1.8m. opportunities.”
mixed fortunes. But unlike Sensirion’s otherwise robust Shares rose 3.2% on Wednesday following
Swiss sensor technology firm SENSIRION saw performance, Medartis’ IPO-adjusted results the results and climbed throughout the week.
strong demand when it floated in March. Despite show minimal year-on-year changes in operating By Friday’s close the share price had climbed to
top-of-the-range pricing of SFr36, its share profit and Ebitda. When adjusted for IPO costs, 245.65p, 1.7% shy of its IPO price.
price has never dropped below SFr40 in five operating profit dropped 2% from H1 2017,
months of trading activity and shares closed on coming in at SFr5m. Ebitda, adjusted to exclude THE PARTY CONTINUES FOR ADYEN
Wednesday at SFr55.50. IPO costs, was SFr9m, 5% higher than the Dutch payments firm ADYEN, which boasts a
But its confident debut on the SIX came at SFr8.6m recorded last year. cohort of high-profile clients such as Netflix and
a cost. Sensirion’s H1 financial results show Shares reflected this neutral performance, Facebook, delivered one of the most exciting
that fees associated with its flotation led to a and were more or less flat at around SFr72 at European IPOs seen in years in June. Investor
SFr0.8m operating loss and a net loss of SFr2m. the close on Friday. enthusiasm was palpable straight off the bat,
In total it forked out SFr8.8m in IPO-related with shares in the €849m IPO opening at €400
costs, including an IPO loyalty share programme AVAST SHARES FLOUNDER BUT HACKERS each on its June 13 debut, two-thirds higher than
for employees. The one-off expense was partly BOOST SALES its IPO price of €240.
to blame for Ebitda falling to SFr6.1m this year On May 10, Czech cybersecurity firm AVAST But that was just the start. Values continued to
from SFr10.1m in the first half of last year. disappointed on the first day of its £602m float rise, and the release of a glittering set of mid-year
However when adjusted for the IPO costs, Ebitda on the London Stock Exchange, with shares financials on Wednesday pushed shares to an
increased by 32.7% to SFr15m in the first half of 2018 opening a penny below the bottom-end pricing all-time high of €623 on Thursday. The Thursday
on a 29.6% increase in revenues to SFr90.2m. of 250p. More bad news followed as shares close was slightly softer than trading through the
Investors reacted positively to Sensirion’s first sank to 210.8p by June 1, 16% less than investors day, ending at €607.20, but still dwarfing its IPO
post-IPO financials, with shares rising 7% within had paid out less than a month earlier. Shares price and the first close above €600.
an hour of the open on Wednesday. By the close climbed back up but never truly recovered, First-half net income rose 75% to €48.2m,
on Thursday shares priced at SFr57.50, 60% up persisting at sub-240p levels throughout with the addition of new all-star clients such as
from the IPO. summer. eBay and Dunkin’ Donuts helping earnings.
But Avast’s IPO costs are barely noticeable in Adyen’s IPO costs barely got a mention in its
MEDARTIS SHARES CLIMB BUT PROFITS its strong half-year results, shaving just US$19m results, save its impact on operating expenses
ARE FLAT off its underlying US$201.6m in operating which grew to €5.9m compared with €2.2m
Just a day after Sensirion’s premiere, fellow profits. last year. Irrespective of IPO costs, Ebitda was
Swiss company and medical device provider Avast’s IPO fees shrink in comparison to year- €70.3m, up 83.1% from €38.4m a year earlier.
MEDARTIS started trading, and its shares have on-year profit jump of over two-thirds. Lucy Raitano
The rights issue will involve 142.9m new (ALFûOFûTHEûTARGETEDûRIGHTSûISSUEûPROCEEDSû and the European Bank for Reconstruction
shares offered on an 18-for-25 basis at €0.70 AREûUNDERWRITTENûBYûSHAREHOLDERû$EMETRAû and Development with 5.4%. Other
each. Pricing offers a negligible discount to WHICHûOWNSûûOFû(ELLENICû"ANKûANDûWILLû international investors own 17.5% while
(ELLENICû"ANKSûCURRENTûSHAREûPRICEûWHICHû invest up to €50m if needed, ending with a domestic investors own 15.9%.
CLOSEDû7EDNESDAYûATûõ 20.09% stake if its underwriting is called on. (ELLENICû"ANKûISûACQUIRINGûSTATE
OWNEDû
A private placing to raise a further €50m 4HEûREMAININGûõMûISûGUARANTEEDûBYû #YPRUSû#OOPERATIVEû"ANKSûASSETSûANDû
for the acquisition will run alongside the %MMAû!LPHAûAû#ZECHûPRIVATEûEQUITYûFUNDû LIABILITIESûINCLUDINGûõBNûINûNETûLOANSû
RIGHTSûISSUEûASû(ELLENICûSELLSûMûSHARESûTOû which is not a shareholder and is being paid õBNûINû#YPRUSûGOVERNMENTûBONDSûõBNû
0IMCO
OWNEDû0OPPYû3ARLûATûTHEûSAMEûõû a fee of 4.5% for its commitment. Emma’s in cash and €9.7bn in customer deposits.
per share. The private placing is conditional shareholding will be zero to 17.3% (ELLENICûHASûPAIDûõMûINûCASHûFORûTHEû
on raising the full €100m through the rights depending on the extent to which its assets, which have a net asset value of
issue. backing is required. €247m.
If the total €150m is raised through the /THERûMAJORûSHAREHOLDERSûINû(ELLENICûAREû 4HEûTRANSACTIONûWILLûSTRENGTHENû(ELLENICû
RIGHTSûISSUEûANDûPLACINGû(ELLENICû"ANKSû 4HIRDû0OINTû(ELLENICû2ECOVERYû&UNDûWHICHû "ANKSûPOSITIONûINûTHEû#YPRIOTûBANKINGû
SHAREûCAPITALûWILLûINCREASEûBYû OWNSûû7ARGAMINGû'ROUPûWITHûû sector, bumping it up to second place after
Source: Thomson Reuters SDC code: C4cr LUXURYûSELLERSûTHEûPROSPECTUSûSAID Source: Thomson Reuters SDC code: C3r
human patients in a Phase I trial in the Entasis has since raised another US$82m Each unit consists of one share of
SECONDûHALFûOFûTHISûYEAR PRIVATELYûFROMûINVESTORSûINCLUDINGû#LARUSû common stock and a warrant to purchase a
,IFEû3CIENCESû.OVOû(OLDINGSû&RAZIERû,IFEû whole share of common stock at US$11.50
ENTASIS FILES FOR IPO Sciences, Pivotal bioVenture Partners, each. Most SPAC units consist of a share of
3OlNNOVAû6ENTUREû0ARTNERSûANDû40'û common and a warrant that represents a
ENTASIS THERAPEUTICS, an antibiotics platform that "IOTECHNOLOGY fraction of a share.
WASûSPUNûOUTûOFû!STRA:ENECAûTHREEûYEARSûAGOû Though there is an indication of interest 4ENZINGSûSPONSORSûALSOûPUTûINû53Mû
lLEDûONû!UGUSTûûFORûANûUPûTOû53Mû)0/ from existing investors on the prospectus via a private placement at the offer price.
Credit Suisse and BMO Capital Markets are cover, the expected level of insider 4HEû30!#ûISûCHAIREDûBYû0ARAGû3AXENAûAû
listed as joint book runners. PARTICIPATIONûHASûNOTûYETûBEENûSET veteran tech investor and an advisor to the
Entasis is looking to fund a Phase III trial Prime Minister of India on foreign direct
of its intravenous antibiotic treatment for SPACS GO ON SALE investments.
multiple drug-resistant bacteria. #%/û2AHULû.AYARûHASûWORKEDûINûCAPITALû
The Phase III trial is expected to begin 3PECIALûPURPOSEûACQUISITIONûCOMPANYûTENZING MARKETSûFORûOVERûûYEARSûANDûWITHû53û30!#û
EARLYûNEXTûYEARûWITHûDATAûEXPECTEDûINûû ACQUISITION raised US$50m from its IPO in management teams to source Indian
%NTASISSûEXISTINGûCASHûPILEûOFû53MûASû ANTICIPATIONûOFûTYINGûUPûWITHûANû)NDIA
BASEDû transactions.
OFû*UNEûûISûENOUGHûTOûFUNDûOPERATIONSûONLYû TECHNOLOGYûCOMPANYûWITHINûûMONTHS All of the proceeds, including funds from
through March 2019, meaning it will 4HISûISûSHORTERûTHANûTHEûTYPICALû
MONTHû the private placement, are being held in a
QUICKLYûNEEDûMOREûFUNDING time frame that SPACs have to complete an trust. The proceeds will be rebated back to
!STRA:ENECAûWHICHûSTILLûOWNSûAûû initial business combination. the public investors if an acquisition does
stake, invested US$23.3m in Entasis when it Underwriter Maxim priced 15m Tenzing not materialize in 18 months.
was spun out in 2015. UNITSûATû53ûAFTERûTHEûCLOSEûLASTû-ONDAY In the meantime, Tenzing will be looking
to complete an initial business combination
GLOBAL CONVERTIBLE OFFERINGS ALL INTERNATIONAL US CONVERTIBLES WITHûANû)NDIA
BASEDûCOMPANYûPREFERABLYûANû
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE OPERATORûINûTHEûTECHNOLOGYûSPACEûORûANOTHERû
Managing No of Total Share Managing No of Total Share fast growing sector.
bank or group issues US$(m) (%) bank or group issues US$(m) (%) MEGALITH FINANCIAL ACQUISITION closed the
1 Goldman Sachs 44 9,847.83 14.0 1 Goldman Sachs 31 5,106.31 16.1 SUMMERû)0/ûWINDOWûBYûPRICINGûAû53Mû
2 JP Morgan 45 7,004.04 9.9 2 Morgan Stanley 31 4,734.26 14.9 30!#ûOFFERINGûONû4HURSDAY
3 Morgan Stanley 40 6,094.08 8.6 3 JP Morgan 33 4,486.37 14.2 Chardan Capital Markets priced 15m units
4 BAML 31 5,070.70 7.2 4 BAML 26 4,338.01 13.7 at US$10 each. Each unit consists of one
5 Citigroup 22 3,697.67 5.2 5 Citigroup 15 2,569.35 8.1 common share and a full warrant to
6 Credit Suisse 19 2,640.65 3.7 6 Barclays 11 1,763.30 5.6 purchase another share at US$11.50.
7 Deutsche Bank 14 2,576.35 3.7 7 Wells Fargo 12 1,636.13 5.2 -EGALITHûISûLEDûBYû*AYû3IDHUûTHEûFORMERû
8 UBS 7 2,268.82 3.2 8 Deutsche Bank 7 969.83 3.1 head of Sovereign Bancorp.
9 Barclays 14 2,066.55 2.9 9 RBC 7 958.45 3.0 4HEûTRUSTûPROCEEDSûINCLUDEû53Mû
10 Wells Fargo 12 1,636.13 2.3 10 Credit Suisse 9 778.00 2.5 FROMûAûPRIVATEûPLACEMENTûOFûMûWARRANTSû
Total 254 70,536.47 Total 84 31,683.12 at US$1.00 a share with Sidhu and his
Including exchangeables. associates.
Source: Thomson Reuters SDC code: C9 Source: Thomson Reuters SDC code: C9a
ALL INTERNATIONAL ASIAN CONVERTIBLES
GLOBAL CONVERTIBLE OFFERINGS – EMEA ALL INTERNATIONAL ASIAN CONVERTIBLES (EXCLUDING JAPAN)
BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE BOOKRUNNERS: 1/1/2018 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues US$(m) (%) bank or group issues US$(m) (%) bank or group issues US$(m) (%)
1 UBS 3 1,849.73 18.4 1 Goldman Sachs 3 2,289.76 23.4 1 Goldman Sachs 2 2,136.01 28.8
2 SG 7 1,072.57 10.6 2 Credit Suisse 7 1,443.85 14.7 2 Credit Suisse 7 1,443.85 19.5
3 JP Morgan 6 1,069.08 10.6 3 Nomura 8 1,044.82 10.7 3 JP Morgan 3 730.92 9.9
4 Deutsche Bank 4 1,022.29 10.1 4 JP Morgan 3 730.92 7.5 4 BNP Paribas 3 581.83 7.8
5 Citigroup 5 792.52 7.9 5 BNP Paribas 3 581.83 5.9 5 China Merchants Secs 1 333.33 4.5
6 BNP Paribas 6 673.63 6.7 6 Sumitomo Mitsui Finl 3 566.61 5.8 =5 Citic 1 333.33 4.5
7 Goldman Sachs 5 632.75 6.3 7 Daiwa Securities 3 524.29 5.4 7 Morgan Stanley 2 318.89 4.3
8 Morgan Stanley 3 399.50 4.0 8 Morgan Stanley 4 460.32 4.7 8 Deutsche Bank 2 312.49 4.2
9 BAML 3 385.75 3.8 9 China Merchants Secs 1 333.33 3.4 9 Nomura 2 248.49 3.4
10 HSBC 3 343.25 3.4 =9 Citic 1 333.33 3.4 10 Citigroup 1 235.80 3.2
Total 30 10,072.17 Total 34 9,792.25 Total 22 7,416.92
Including exchangeables. Including exchangeables. Including exchangeables.
Source: Thomson Reuters SDC code: C09d Source: Thomson Reuters SDC code: M10 Source: Thomson Reuters SDC code: M11
CLO market professionals use LPC Collateral to run market value coverage analysis on CLO
tranches and to compare holdings, asset breakdowns and overlap across CLOs.
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PHOTOCOPYINGûRECORDINGûORûOTHERWISEûWITHOUTûWRITTENûPERMISSIONûOFûTHEûPUBûLISHERSû!CTIONûWILLûBEûTAKENûAGAINSTûCOMPANIESûORûINDIVIDUALûPERSONSûWHOûIGNOREûTHISûWARNINGû4HEû
INFORMATIONûSETûFORTHûHEREINûHASûBEENûOBTAINEDûFROMûSOURCESûWHICHûWEûBELIEVEûTOûBEûRELIABLEûBUTûISûNOTûGUARANTEEDû3UBSCRIPTIONSûTOû)&2ûAREûNON
REFUNDABLEûAFTERûTHEIRûCOMMENCEMENTû
ISSUEûDATEûÊû4HOMSONû2EUTERSûû2EGISTEREDûASûAûNEWSPAPERûATûTHEû0OSTû/FlCEû2EGISTEREDû/FlCEû4HOMSONû2EUTERSû,TDûû3OUTHû#OLONNADEû#ANARYû7HARFû,ONDONû%û%0û
2EGISTEREDûNOûû%NGLANDû0RINTEDûINû%NGLANDûBYû7YNDEHAMû'RANGEû,TDû"RIGHTONû3USSEXû)33.û
û5NAUTHORISEDûPHOTOCOPYINGûISûILLEGAL
24-7 Intouch 58 European Stability Mechanism 20 New South Wales Treasury Corp 28
Aareal Bank 29 Eventbrite 72 NKT Group 54
ABN AMRO Bank 26 Everbright Securities Financial Holdings 52 Nordea Bank 26
Abu Dhabi Islamic Bank 67 Evercore 15 Nyrstar 32
Adaro Energy 50 Falabella 61 OneSavings Bank 34
Admiralty Harbour Capital 18 Fantasia Group (China) 45 OP Corporate Bank 27
Adyen 66 Farfetch 67 Orsted 26
Aeroporti di Roma 25 Ferrovie dello Stato 49 Osotspa 65
Afterpay Touch Group 62 Fiat Chrysler 49 PDVSA 48
Agence Francais e de Developpement 21 Finland 20 Piaggio 49
AGS Transact Technologies 64 FMS Wertmanagement 22 Power Construction Corporationof China 45
Akbank 8 Fosun Industrial 51 Primary Health Care 62
Akzo Nobel 8 Fosun International 51 Principia Biopharma 70
A’lienor 54 Fufeng Group 44 Prosper 37
Alinta Energy 50 Fuyu Development Group 45 Prysmian 49
Alternatifbank 55 Gansu Province Electric Power Investment Group 45 Public Investment Fund 55
Angola 43 Garanti Bank 8 Qutoutiao 63
Anhui Transportation Holding Group 44 Generali 49 Rabobank 19
Appian 68 Global Net Lease 56 Raiffeisenlandesbank Niederoesterreich-Wien 30
Aramco 55 Goldman Sachs 15, 33 Redco Properties Group 44
Arvedi 49 Gosforth Funding 34 Reliance Communications 45
Ascentage Pharma 6, 64 Grail 6 Reliance Industries 53
AsiaInfo Holdings 63 Gritstone Oncology 70 Reliance Jio Infocomm 53
Asian Development Bank 22 Grupo Coppel 61 Rentenbank 22
Atlantia 25, 49 Hellenic Bank 65 Rosneft Trading 48
Autostrade per l’Italia 25, 49 Hemisphere International Properties 60 Route Mobile 64
Avast 66 Hengtong Optic-Electric 52 Royal Bank of Canada 12
Bajaj Group 64 Hexaware Technologies 65 Sanef 54
Banco Popular 9 HNA Group 51 San Miguel Food and Beverage 7
Bank Australia 28 Honda 37 Santander 11
Bank of Changsha 64 Housing and Urban Development Company 65 Santander UK 33, 35
Bank of Ireland 19 Hua Medicine 6 Santos 50
Bank of the Philippine Islands 45 Huarong International Financial Holdings 52 Saptaindra Sejati 53
Bank Sohar 55 Huarong Investment Stock Corp 52 Saudi Arabia 55
Barclays plc 16, 27 ING Bank AS 8 Saudi Aramco 4
Bay Club 58 Inter-American Development Bank 22 Schleswig-Holstein 21
Belfius Bank 27 International Bank for Reconstruction and Development 6 Sensirion 66
Berlin 21 International Finance Corporation 22 Shandong Gold Group 45
Berlin Hypo 4, 30 Intesa Sanpaolo 5 Shanghai Henlius Biotech 6
Bingo Industries 62 Islamic Republic of Pakistan 53 Shanghai Lingang Economic Development (Group) 44, 45
Bluestone Group 37 Italy 21 Shearwater GeoServices 55
BMW 23 Ithaca Energy 56 Shihlien China Holding 54
Cairn Homes 55 Japan Student Services Organization 22 Shinhan Bank 29
Caliber 35 Jefferies 13, 15 Singapore Telecommunications 43
Canadian Imperial Bank of Commerce 13 JSW Steel 52 Sixt 55
CareTech Holdings 56 KBS US Prime REIT 61 Social Finance 36
Cazenovia Creek 37 KommuneKredit 20 SoftBank Corp 53
CCG 37 Korea Development Bank 45 Spark Finance 25
CDB Financial Leasing 52 Korea Expressway 46 Steinhoff 60
Central Japan Railway 23 Korea Water Resources 46 Stone Pagamentos 61
China General Nuclear Power Corporation 44 Læringsverkstedet 26 Studio City International 65
China Ping An Insurance Overseas (Holdings) 44 Landesbank Baden-Wuerttemberg 29 Swedbank 26
China Southern Power Grid 45 Langfang Hongtai Industrial Town Investment 45 Tasly Biopharmaceutical 6
Ciro’s Real Estate 51 LATAM Airlines Group 57 Techem 8
Citycon 23 Lazard 15 Telecom Italia 49
CMIG Futurelife 63 LCY Chemical 60 Tencent Music Entertainment 63
Coesia 49 Leonardo 49 Tenzing Acquisition 71
Coltel 61 LF Logistics 64 Tesla 17
Comcast 57 Lloyds Banking Group 11 Thomson Reuters 8
Commercial Credit Group 37 Logan Property Holdings 44 Tianqi Lithium 63
Commerzbank 4, 29 Louis Dreyfus Co Asia 53 TrailStone Group 57
Commonwealth Bank of Australia 29 Mabpharm 6, 64 True Partner Investments 51
Constellation Brands 57 Macquarie University 28 Tsinghua Holdings 45
Credit Agricole 12 Macrolink Holding 45 Turk Ekonomi Bankasi 8
Credit Union Australia 29 Mahanagar Gas 65 Turk Eximbank 8
Cree 72 Maoyan Weying 63 United Microelectronics Corp 65
Cumulus Media 31 Marfrig 48 Viettel Global Investment 54
Daimler 23 mBank 46 Virgin Money 34
Dalian Wanda Group 51 Medartis 66 Volkswagen Bank 34
Deutsche Bank 4 Medpace 68 Volkswagen Financial Services Australia 25
Deutsche Pfandbriefbank 30 Megalith Financial Acquisition 71 Wallenius Wilhelmsen 26
Douglas 59 Meituan Dianping 63 Weatherford International 58
Driver fifteen 34 Mekonomen 67 Westpac New Zealand 27
Eiffage 54 MercadoLibre 61, 72 World Co 65
Eika Boligkreditt 29 Mirae Asset Daewoo 45 Wuhan Financial Holding (Group) 45
Elia System Operator 24 Modernland Realty 45 Yangzhou Slender West Lake Tourist Development Group 45
Elizabeth Finance 2018 33 Nanjing Hong Kong Source Investment Advisory 45 Yapi ve Kredi Bankasi 8
Endeavour Energy 50 National Australia Bank 27 Zai Lab 6
Enstar Group 56 Nature’s Care Manufacture 59 Zekelman Industries 70
Entasis Therapeutics 71 NBCC India 65 Z Energy 25
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