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Saturday, 19 January 2019

Going Stateside

IFR 2267 19 January to 25 January 2019

It’s one of the oddities of the sovereign market that eurozone governments rarely visit the US dollar market. Sure, the euro provides plenty of home comforts. But given that many of these sovereigns have billions of euros of annual gross funding needs, it’s bizarre how they continue to eschew the biggest bond market in the world.

Top News

Italy

Italy to test US dollar market after record BTP sale

IFR 2267 19 January to 25 January 2019 By

The Republic of Italy is weighing up plans to issue its first US dollar bond in nearly a decade, after investors gave the sovereign a big vote of confidence in the euro market last week when they lapped up its first publicly syndicated deal in the single currency for a year.

UBS chief executive Andrea Orcel leaves after attending a UK parliamentary inquiry into Libor rates

Orcel in limbo after shock Santander U-turn

IFR 2267 19 January to 25 January 2019 By ,

Santander’s attempt to poach star UBS investment bank chief Andrea Orcel to be its next CEO ended in farce last week when the Spanish bank balked at paying €50m to buy out share awards he was due.

Shanghai Stock Exchange

Shanghai tech board takes shape

IFR 2267 19 January to 25 January 2019 By ,

The Shanghai Stock Exchange’s eagerly awaited technology-focused board may be off-limits to China’s biggest overseas-listed technology companies.

Banners of Deutsche Bank and Commerzbank

Deutsche-Commerzbank merger plans dealt a major blow

IFR 2267 19 January to 25 January 2019 By

The shotgun marriage might be off. Berlin’s favoured solution to the problem child that is Deutsche Bank – a merger with smaller rival Commerzbank – has been dealt a heavy blow, after European regulators indicated they would disapprove of the union and appealed for a better suitor.

Employees of Pacific Gas & Electric work in the aftermath of the Camp Fire in Paradise

PG&E misses bond payment as default looms

IFR 2267 19 January to 25 January 2019 By Aaron Weinman,

PG&E skipped an interest payment on one of its bonds on Tuesday after the struggling California utility said it planned to file for Chapter 11 bankruptcy before the end of the month.

SEC headquarters

US IPO hinges on shutdown ending

IFR 2267 19 January to 25 January 2019 By

New Fortress Energy is not letting a measly US government shutdown - and the resulting partial closure of the SEC - stop it from taking its US$421.8m Nasdaq IPO on the road.

Bank of England governor Mark Carney

Carney raises pressure on leveraged loans

IFR 2267 19 January to 25 January 2019 By ,

The chorus of warnings about leveraged loans as a potential threat to financial stability grew louder after the Bank of England expressed concern again that the market might be heading for trouble.

AB InBev

AB InBev deal could spur Triple B refinancing wave

IFR 2267 19 January to 25 January 2019 By

Anheuser-Busch InBev’s US$15.5bn bond offering is likely to be the first of a string of refinancings from Triple B rated companies looking to tackle near-term debt maturities after gorging on debt to fund acquisitions.

HK lures rare non-Chinese listings

HK lures rare non-Chinese listings

IFR 2267 19 January to 25 January 2019 By

After an absence of several years, international issuers are returning to Hong Kong’s IPO market, with at least three non-Chinese companies preparing to raise a combined US$5bn.

First Data logo

First Data hopes Fiserv will take on the load

IFR 2267 19 January to 25 January 2019 By ,

The credit outlook for debt-laden payment processing firm First Data brightened on Wednesday on news it will merge with larger rival Fiserv, which carries investment-grade ratings.

Energizer

Energizer shrinks equity raising to US$375m

IFR 2267 19 January to 25 January 2019 By

Energizer Holdings approached its equity raising with a view that its stock is undervalued and underappreciated.

IFR Magazine Top News in Full (subscription required)

People & Markets

Equity trading surges to match FICC

IFR 2267 19 January to 25 January 2019

A sluggish fourth quarter for bond trading turned into a rout in December as clients were spooked by the US Federal Reserve, leaving bond trading revenues for 2018 down from 2017 and banks thankful for buoyant equities trading.

M&A surge lifts investment banking past FICC

IFR 2267 19 January to 25 January 2019

The largest US banks made more from advisory and underwriting in the fourth quarter than from fixed income trading for the first time at least since the financial crisis.

BAML investment bank chief goes after M&A slump

IFR 2267 19 January to 25 January 2019

Bank of America Merrill Lynch’s global head of investment banking Diego De Giorgi is stepping down at the end of February.

Noble conqueror continues his crusade

Noble conqueror continues crusade

IFR 2267 19 January to 25 January 2019

Noble Group wrapped up its US$3.5bn debt restructuring last month, the denouement of a remarkable three years that had seen the former commodities trading giant teeter on the brink of collapse, but the man who piled pressure on the firm is not done fighting yet.

Citi picks Livingstone to run EMEA

IFR 2267 19 January to 25 January 2019

Citigroup has picked the head of its Australia and New Zealand business, David Livingstone, to run its business in Europe, Middle East and Africa to replace the departing Jim Cowles.

    More from People & Markets

    Bonds

    IG issuers hit three-year jackpot

    IFR 2267 19 January to 25 January 2019

    Asian investment-grade issuers harnessed global demand for shorter tenors last week to issue dollar bonds at minimal new issue concessions.

    China: Kangde Xin adds to defaults

    IFR 2267 19 January to 25 January 2019

    Kangde Xin Composite Material Group joined a growing list of Chinese bond defaulters last week, adding to concerns that China’s easing measures are doing little to help weaker private-sector borrowers.

    South Korea: KNOC draws strong demand for Samurai debut

    IFR 2267 19 January to 25 January 2019

    Korea National Oil Corp made a successful debut in the Samurai market last Wednesday, raising an impressive ¥70bn (US$645m) from an offering of three-year bonds.

    India: Issuers move fast

    IFR 2267 19 January to 25 January 2019

    Bharat Petroleum Corporation (BPCL) has become the first Indian issuer to take advantage of a rule change easing restrictions on short-dated offshore bonds.

    Hong Kong: Rare foray for Johnson Electric

    IFR 2267 19 January to 25 January 2019

    Johnson Electric Holdings, rated Baa1/BBB (Moody’s/S&P), has mandated Citigroup and HSBC as global coordinators, bookrunners and lead managers for a US dollar bond.

      More from Bonds

      Loans

      PNG leads wave of jumbo project loans

      PNG leads wave of jumbo project loans

      IFR 2267 19 January to 25 January 2019 By Sophia Rodrigues

      The expansion of Papua New Guinea’s giant gas project is turning up the heat in the Asia-Pacific project finance arena, with a slew of jumbo financings set to emerge from Oceania in the next 18 months.

      Bank of England governor Mark Carney

      Carney raises pressure on leveraged loans

      IFR 2267 19 January to 25 January 2019 By ,

      The chorus of warnings about leveraged loans as a potential threat to financial stability grew louder after the Bank of England expressed concern again that the market might be heading for trouble.

      Hong Kong: ASM Pacific eyes CB refi

      IFR 2267 19 January to 25 January 2019

      Hong Kong-listed ASM Pacific Technology is raising HK$2.25bn-equivalent (US$288m) through a debut syndicated loan to refinance a convertible bond issue maturing in March.

      Vimicro seeks HK$2.3bn recap loan

      IFR 2267 19 January to 25 January 2019

      Vimicro, a pioneer in developing computer chips and components in China, is seeking a HK$2.266bn-equivalent three-year bullet loan to fund its dividend recapitalisation and refinancing.

      Sun Hung Kai pays up for the first time in six years

      Hong Kong: SHK pays up for first time in years

      IFR 2267 19 January to 25 January 2019

      Real estate giant Sun Hung Kai Properties is in the market for a HK$5bn (US$641m) five-year loan that offers richer pricing than its previous borrowing, marking the end of a streak that had seen its cost of funding more than halve since 2013.

      Genting Hong Kong

      Hong Kong: Genting sets sail for US$300m deal

      IFR 2267 19 January to 25 January 2019

      Cruise operator Genting Hong Kong has launched a US$300m four-year term loan and revolving credit facility, returning to the loan market after 2-1/2 years.

      Chinese tycoon taps refi for Cainiao investment loan

      Tycoon taps refi for Cainiao loan

      IFR 2267 19 January to 25 January 2019

      Chinese tycoon Guojun Shen’s investment vehicle is in the market for a US$550m five-year loan that refinances a borrowing signed three years ago to fund his investment in logistics start-up Cainiao Smart Logistics Network.

      China: Copper producer seeks trade facility

      IFR 2267 19 January to 25 January 2019

      Yanggu Xiangguang Copper, a unit of Xiangguang Group, is seeking a structured trade facility of up to US$180m on a club basis.

      More from Loans

      Equities

      Lenovo points to strong equity-linked year

      Lenovo points to strong equity-linked year

      IFR 2267 19 January to 25 January 2019

      A US$675m convertible bond from smartphone and computer maker Lenovo Group has highlighted appetite for structured equity investments in what is expected to be a volatile year for Asian markets.

      Signs of life in Philippines ECM

      Philippines: Foreigners return through Ayala ABB

      IFR 2267 19 January to 25 January 2019

      Japan’s Mitsubishi raised Ps11.7bn (US$222.4m) through the sale of 13m Ayala shares at Ps900 in a deal triggered by reverse enquiry from international investors.

      China: Xiaomi block raises HK$2.18bn

      IFR 2267 19 January to 25 January 2019

      An undisclosed institutional seller has raised HK$2.18bn (US$278m) from the sale of a stake in Chinese smartphone maker Xiaomi.

      China: Longfor block raises HK$3.4bn

      IFR 2267 19 January to 25 January 2019

      A selldown in property developer Longfor Group was upsized to raise HK$3.4bn (US$434m) last Wednesday.

      China: Kepei Education launches HK IPO

      IFR 2267 19 January to 25 January 2019

      China Kepei Education Group, a provider of private higher education, started bookbuilding last Monday for a Hong Kong IPO of up to HK$954m (US$122m).

      China: YeePay turns to US

      IFR 2267 19 January to 25 January 2019

      YeePay, a payment services provider, has dropped its Hong Kong listing plan and aims to list in the US instead, said people close to the deal.

      China: Maoyan Entertainment launches IPO

      IFR 2267 19 January to 25 January 2019

      Tencent-backed Maoyan Entertainment, China’s biggest online seller of film tickets, started bookbuilding last Friday for a Hong Kong IPO of up to HK$2.7bn (US$344m).

      China: Megvii kicks off IPO work

      IFR 2267 19 January to 25 January 2019

      Megvii, the owner of facial recognition developer Face++, has kicked off preparations for a Hong Kong IPO of up to US$1bn this year, according to people close to the deal.

      More from Equities

      Canadians go on international funding spree

      18 January 2019 By

      Ontario and Manitoba added to the flow of Canadian public sector issuers turning to the international bond markets for funding this year, bringing US dollar and sterling trades.

      Regime change hopes bolster Venezuela bonds

      18 January 2019 By

      Venezuela bonds have been outperforming on hopes that President Nicolas Maduro may soon fall from power, leading to an easing of US sanctions and potential talks on defaulted debt.

      ABS market still unsure of footing

      18 January 2019 By

      The US ABS market is still finding its groove after a sharp fourth-quarter sell-off that it has been slower to recover from than other types of credit.

      French flag

      MOVES-Barclays promotes Ortiz to senior French role

      18 January 2019 By

      Barclays has appointed Emmanuelle Ortiz senior coverage banker in France in addition to her role leading debt capital markets and risk solutions group for France and Belgium.

      Hamburg's Water Castle

      MOVES-Hauck & Aufhauser adds ex-Lazard man for ECM

      18 January 2019

      Robert Brownell has joined Hauck & Aufhauser in its ECM division based in Hamburg. The private bank has been around for over two centuries yet the investment bank was formed only a decade ago.

      Scarcity factor lures investors to US bank bonds

      18 January 2019 By

      Wells Fargo and Morgan Stanley saw strong demand for bail-in bonds this week as the buyside scrambled to get hold of debt that is expected to be limited in supply this year.

      Investors snap up deals in supply-starved US HY

      18 January 2019 By

      The US high-yield market started to warm up this week as investors poured cash back into bond funds and spreads snapped tighter, helping issuers land upsized deals.

      IFR SNAPSHOT-Week ends on quiet note, more FIGs next week

      18 January 2019 By

      It’s Friday and they are rolling up the IG carpet for the weekend and the Martin Luther King holiday on Monday.

      Fitch Ratings headquarters in New York

      Fitch launches European high-yield index

      18 January 2019 By

      Fitch launched its European high-yield index report on Thursday, which expands its research offerings in the leveraged finance sector.

      BPCE

      BPCE brings its biggest Samurai

      18 January 2019 By

      BPCE returned to the yen market via one of its usual windows to raise ¥163.6bn (US$1.496bn) from a five-tranche Samurai transaction, the French bank’s biggest Samurai deal since its debut in 2012 and pushing the overall total raised past the ¥1trn milestone.

      Mortgage

      Banks test their first prime jumbo RMBS deals of 2019

      17 January 2019 By

      JP Morgan and Wells Fargo are testing appetite for a pair of mortgage bond deals after reporting falling revenues in their home lending units for the fourth quarter.

      Market raises glass to AB InBev

      Anheuser-Busch deal could spur Triple B refinancing wave

      17 January 2019 By

      Anheuser-Busch InBev’s US$15.5bn bond offering is likely to be the first of a string of refinancings from Triple B rated companies looking to tackle near term debt maturities after gorging on debt to fund acquisitions.

      Morgan Stanley

      Morgan Stanley garners US$10.75bn order book on US$3bn bond

      17 January 2019 By

      Morgan Stanley built a US$10.75bn order book for its 11NC10 US$3bn bond, which priced today at spreads of 170bp above Treasuries.

      RBS building in London

      RBS plans buyback of UK government shares

      17 January 2019

      RBS is planning to buy back some of the UK government’s shares in the bank. Shareholders will be asked to approve the measure, which covers up to 4.99% of the bank in any one year, at a general meeting on February 6.

      debut sukuk south africa

      Cornerstones back R2bn Revego listing

      17 January 2019

      A planned R2bn (US$145.2m) listing of new South African renewables investment vehicle Revego Africa Energy will have cornerstone investments covering 50% of the deal.

      Morgan Stanley

      Morgan Stanley FICC sinks RoE below 10%

      17 January 2019 By

      Morgan Stanley was hurt more than its peers by the shutdown of client activity in the fourth quarter that wreaked havoc on trading groups across Wall Street.

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      Bank of the Year: JP Morgan

      Bank of the Year: JP Morgan

      IFR Awards 2018 By

      JP Morgan dominates investment banking in a way no other institution has in the modern era. Whatever the measure – wallet share, market share, revenue, profits, share price performance, or sheer presence – JP Morgan is the answer. For the second year running, it is IFR’s Bank of the Year.

      Read the write-ups on each award winner

      Special Reports and Roundtables

      IFR Awards 2018 IFR+Awards+2018+Homepage+Cover
      So here’s a funny thing. The one asset class that the great and good of the global economy seems to be worried about – leveraged loans – is just about the only one that has made money for investors in 2018.

      IFR IMF/World Bank Roundtable 2018 IFR+IMF+World+Bank+RT+2018+Cover+Homepage
      Delegates at the IMF’s annual meetings in Bali got an uncomfortable reminder of Asia’s vulnerability to unforeseen shocks with an earthquake in the small hours of October 11. The financial markets have been doing their part, too.

      If it aint woke…

      IFR 2266 12 January to 18 January 2019

      THE POPULARITY OF Veganuary has raised awareness of the climate implications of eating meat and some investors are tucking into the new diet.