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Sunday, 17 December 2017

Ding dong merrily on high

IFR 2214 16 December to 5 January 2018

Christmas has come early for investment banks this year. Last week, the annual haul of fees that banks earn from underwriting and advisory work crossed the US$100bn threshold for only the second time in the industry’s history – the only other time was 2007.

Top News

Creative financing for record property deal

Creative financing for record property deal

IFR 2214 16 December to 5 January 2018 By Clare Jim, Yan Jiang

The China-backed buyer of a Hong Kong skyscraper for a record US$5.2bn is relying heavily on mezzanine financing as it seeks to borrow as much as 90% of the purchase price.

A new residential quarter of the Country Garden is seen in Shanghai, China, February 10, 2017.

Country Garden flags funding curbs

IFR 2214 16 December to 5 January 2018 By ,

Country Garden underlined the funding challenges facing Chinese property developers last week as it scrapped plans for a spin-off in the A-share market for regulatory reasons.

Indian Finance Minister Arun Jaitley speaks at an "Invest in India" forum in Beijing, China.

Indian banks rush out stock sales

IFR 2214 16 December to 5 January 2018 By

India’s state-owned banks are already on course to raise more than half their Rs580bn (US$9bn) target from the equity capital markets less than two months after the government unveiled a sweeping recapitalisation plan.

Detsky Mir

Block trade cancelled after allocations

IFR 2214 16 December to 5 January 2018 By

There was a rare example last week of an accelerated trade being cancelled after the shares had already been allocated, when legal action against Russian conglomerate Sistema led to its holding in toy retailer Detsky Mir being frozen hours after a placing.

Oasis Petroleum logo

Oasis Petroleum pays up to enter Permian

IFR 2214 16 December to 5 January 2018 By

West Texas oil production reserves are scarce and expensive, as was shown again when Oasis Petroleum paid up to get into the heart of the Permian Basin with its acquisition of Forge Energy.

UniCredit

UniCredit fights to cut Fino loan exposure

IFR 2214 16 December to 5 January 2018 By ,

UniCredit said it had reached an agreement to sell a €990m portion of a €16.2bn portfolio of bad loans to Italian insurer Generali and has lined up more disposals for the first quarter of 2018.

trueEX logo

Banks sign up to truePTS as legal dust settles

IFR 2214 16 December to 5 January 2018 By

TruePTS, the post-trade processing arm of swap execution facility trueEX, has signed Citigroup and JP Morgan as its first clients. The agreement comes just days after the start-up platform resolved a legal dispute with legacy provider IHS Markit.

Qatar National Bank's head office building in Doha

Banks rally round Qatar National Bank

IFR 2214 16 December to 5 January 2018 By

International banks are supporting the refinancing of a US$3bn loan for Qatar National Bank with nine Asian, US and European banks underwriting the deal.

UniCredit

UniCredit rounds off transformational year with AT1

IFR 2214 16 December to 5 January 2018 By

As well as announcing its latest efforts to dispose of non-performing loans, UniCredit last week returned to the euro AT1 market almost exactly a year after a costly club deal. The much lower coupon highlighted the progress made by the bank over the course of 2017.

Workers stand in front of a drilling rig at an oil well operated by PDVSA

CDS auction values Venezuela debt at cents on dollar

IFR 2214 16 December to 5 January 2018 By

Banks valued defaulted bonds of Venezuela’s state oil company PDVSA at just 17.625 cents on the dollar on Wednesday, in an auction to fix how much owners of credit default swaps referencing the debt will be paid.

IFR Magazine Top News in Full (subscription required)

People & Markets

HSBC's sword of Damocles removed

IFR 2214 16 December to 5 January 2018

HSBC’s deferred prosecution agreement with the US Department of Justice has expired, reducing the intense scrutiny and threat of stiff punishment on the bank following its lax anti-money laundering controls in Mexico between 2006 and 2008.

Annual SG 'bear-fest' poses early MiFID II test

IFR 2214 16 December to 5 January 2018

One of the first tests of preparedness for new MiFID II research unbundling rules is set to take place on January 9, when Societe Generale’s perma-bear strategist, Albert Edwards, unveils his latest doom-and-gloom musing on his Ice Age thesis.

US bank stocks soar into 2018

IFR 2214 16 December to 5 January 2018

The top five US banks continued to surge one year after the surprise election of Donald Trump unleashed hopes of tax cuts and regulatory reform. While neither has come to pass, the expectations are still keeping the stocks sailing.

Who's moving where...

IFR 2214 16 December to 5 January 2018

Citigroup has appointed the OECD’s Catherine Mann as its new chief economist. Mann will start in February and replaces Willem Buiter (left), who becomes a special economic adviser to the bank. Mann, who has been chief economist since 2014 at the Paris-based Organisation for Economic Cooperation and Development, will be based in New York. Mann has also worked at the Federal Reserve Board, the Council of Economic Advisors in the White House and the World Bank. Buiter will focus on client relationships and major research projects.

UK urged to give Green bonds tax breaks

IFR 2214 16 December to 5 January 2018

Britain should consider tax breaks for firms issuing Green bonds and set up a green standards board to help it become a global hub for finance linked to environmental or climate-related benefits.

    More from People & Markets

    Bonds

    Men stand in front of a screen displaying the Dollar to Yen exchange rate in Tokyo, Japan.

    Yen market seen diversifying

    IFR 2214 16 December to 5 January 2018

    Bankers expect a more diverse range of issuers to sell yen bonds in 2018 as Japanese investors move down the credit curve in search of higher returns.

    France names Green OAT council members

    IFR 2214 16 December to 5 January 2018

    The French government’s Green OAT Evaluation Council held its first meeting and named its members last Monday. The council, whose inception was announced in January when France sold its first Green bond, is responsible for publishing reports on the environmental impact from the money raised.

    KfW to raise €70bn-€75bn in 2018, focus on liquidity

    IFR 2214 16 December to 5 January 2018

    KfW is planning to raise between €70bn and €75bn in 2018, slightly less than the €77.3bn printed in 2017, and will focus on adding liquidity to outstanding euro benchmarks.

    ECB leaves door open for longer, bigger QE

    IFR 2214 16 December to 5 January 2018

    ECB president Mario Draghi stressed that the asset purchase programme might be further extended and/or increased depending on financial conditions during a press conference on Thursday last week, adding that at present an ample degree of monetary stimulus remained necessary.

    Unibail-Rodamco secures bridge for Westfield buy

    IFR 2214 16 December to 5 January 2018

    French real estate company Unibail-Rodamco has netted a €6.1bn acquisition financing facility to help fund its US$24.7bn purchase of shopping centre owner Westfield Corp.

      More from Bonds

      Loans

      Creative financing for record property deal

      Creative financing for record property deal

      IFR 2214 16 December to 5 January 2018 By Clare Jim, Yan Jiang

      The China-backed buyer of a Hong Kong skyscraper for a record US$5.2bn is relying heavily on mezzanine financing as it seeks to borrow as much as 90% of the purchase price.

      Melbourne Metro PPP picks up pace

      Australia: Melbourne Metro picks up pace

      IFR 2214 16 December to 5 January 2018 By Sharon Klyne

      The Melbourne Metro Tunnel project is set to offer a rare opportunity for retail lenders to participate in the financing of a major public-private partnership in Australia.

      Mattel junked amid debt refinancing

      IFR 2214 16 December to 5 January 2018 By

      Mattel joined the ranks of fallen angels on Monday as all three main ratings agencies chopped the toymaker’s bond ratings after it announced a US$1bn bond offering.

      Hong Kong: Victory City takes refinancing

      IFR 2214 16 December to 5 January 2018

      A term loan of HK$2.6bn-equivalent (US$333m) for Hong Kong-listed knitted fabric maker Victory City International Holdings has been signed.

      China: Hisense closes debut facility

      IFR 2214 16 December to 5 January 2018

      State-owned electronics manufacturer Hisense has closed a maiden three-year loan of US$300m as eight banks joined in general syndication.

      China: JD.com doubles loan

      IFR 2214 16 December to 5 January 2018

      JD.com, China’s second-largest e-commerce firm, has doubled its debut five-year loan to US$1bn from an initial US$500m after commitments from 19 lenders in syndication.

      China: ChemChina take-out attracts 15

      IFR 2214 16 December to 5 January 2018

      A US$5.5bn loan to refinance a jumbo bridge facility China National Chemical used to acquire Switzerland’s Syngenta has attracted 15 banks.

      China: Goldwind plans US$300m debut

      IFR 2214 16 December to 5 January 2018

      Hong Kong-listed Xinjiang Goldwind Science & Technology is seeking a US$300m three-year financing on its debut in the offshore syndicated loan market.

      More from Loans

      Equities

      China: WuXi stockholder cashes in

      IFR 2214 16 December to 5 January 2018

      Largest stockholder WuXi Biologics Holdings has sold a block of shares in Hong Kong-listed WuXi Biologics to raise HK$5.071bn (US$649m).

      China: CPID rights issue oversubscribed

      IFR 2214 16 December to 5 January 2018

      China Power International Development saw its HK$4.46bn (US$571m) rights issue well oversubscribed, with total demand about twice the shares offered.

      China: AK Medical completes IPO

      IFR 2214 16 December to 5 January 2018

      AK Medical, a manufacturer of orthopaedic joints, has raised HK$437.5m (US$56m) from a Hong Kong IPO.

      China: Hebei Construction completes IPO

      IFR 2214 16 December to 5 January 2018

      Hebei Construction Group has raised HK$1.93bn (US$247m) from its Hong Kong IPO of 433m primary shares.

      China: CEG prices IPO

      IFR 2214 16 December to 5 January 2018

      China Education Group has raised HK$3.23bn (US$413.5m) from its Hong Kong IPO on selling the shares slightly above the mid-point of the indicative price range.

      China: Sunac top-up raises HK$7.82bn

      IFR 2214 16 December to 5 January 2018

      Property developer Sunac China has raised HK$7.82bn (US$1bn) from an enlarged top-up placement of shares.

      China: LexinFintech goes for smaller IPO

      IFR 2214 16 December to 5 January 2018

      LexinFintech has opened books for a Nasdaq IPO of up to US$132m, with Bank of America Merrill Lynch, China Renaissance, Deutsche Bank and Goldman Sachs as joint bookrunners.

      China: ChinaPnR works on US$500m IPO

      IFR 2214 16 December to 5 January 2018

      ChinaPnR intends to raise about US$400m–$500m through a Hong Kong IPO in 2018, according to people familiar with the plans.

      More from Equities

      Derivatives

      Workers stand in front of a drilling rig at an oil well operated by PDVSA

      CDS auction values Venezuela debt at cents on dollar

      IFR 2214 16 December to 5 January 2018 By

      Banks valued defaulted bonds of Venezuela’s state oil company PDVSA at just 17.625 cents on the dollar on Wednesday, in an auction to fix how much owners of credit default swaps referencing the debt will be paid.

      Unibail-Rodamco secures bridge for Westfield buy

      IFR 2214 16 December to 5 January 2018

      French real estate company Unibail-Rodamco has netted a €6.1bn acquisition financing facility to help fund its US$24.7bn purchase of shopping centre owner Westfield Corp.

      ECB leaves door open for longer, bigger QE

      IFR 2214 16 December to 5 January 2018

      ECB president Mario Draghi stressed that the asset purchase programme might be further extended and/or increased depending on financial conditions during a press conference on Thursday last week, adding that at present an ample degree of monetary stimulus remained necessary.

      trueEX logo

      Banks sign up to truePTS as legal dust settles

      IFR 2214 16 December to 5 January 2018 By

      TruePTS, the post-trade processing arm of swap execution facility trueEX, has signed Citigroup and JP Morgan as its first clients. The agreement comes just days after the start-up platform resolved a legal dispute with legacy provider IHS Markit.

      Trading venues stall on MiFID II

      IFR 2214 16 December to 5 January 2018 By

      Many large trading venues are yet to sign contracts for a new service that allows them to create International Securities Identification Numbers for over-the-counter derivatives – a crucial step for MiFID II reporting requirements that come into play on January 3.

      More from IFR Derivatives

      2017 IFR Awards logo

      IFR Awards winners announced

      15 December 2017

      Please click here to see IFR Awards winners

      Glass Mountain wraps US$325m buyout deal

      15 December 2017

      Midstream oil-and-gas company Glass Mountain Pipeline set pricing on the tight end of guidance on a US$325m credit facility backing its buyout by BlackRock.

      Moody's sign

      Xmas tax treats for most corporate borrowers: report

      15 December 2017 By

      Most corporate issuers (except for highly leveraged borrowers) will benefit from tax overhaul legislation now under consideration, Moody’s said in a report released Friday.

      IFR SNAPSHOT: Eventually the party comes to an end

      15 December 2017 By

      It’s basically the end of a banner year, but like at most parties, there are always a couple of hangers-on who aren’t ready to go home just yet.

      Barclays, BNY Mellon opt in for MiFID II SI status

      15 December 2017 By

      Bank of New York Mellon and Barclays have opted in as systematic internalisers for non-equity instruments under MiFID II, becoming the latest dealers to do so.

      The end is nigh

      15 December 2017 By Anthony Peters, BlockEx Capital Markets

      One of the highlights of my week was the annual Teenage Scribblers’ Christmas lunch, which was held on Tuesday in London. 

      Promsvyazbank

      PSB sub sinks to bottom

      15 December 2017 By

      The value of Promsvyazbank’s AT1 bond was all but wiped out after Russia’s central bank said it will move to save the lender in the third Russian banking bailout this year.

      China's Country Garden

      Country Garden revisits reason for withdrawal of spin-off

      15 December 2017

      Country Garden Holdings has taken the unusual step of issuing a second statement about the withdrawal of its application for a proposed spin-off and separate listing of Guangdong Country Garden Property Services in Shanghai, three days after its first notice blamed regulatory changes.

      Casinos are seen in a general view of Macau

      LIB prints rare Macau non-gaming issue

      15 December 2017 By

      Luso International Banking gave investors a rare chance to gain exposure to a Macau credit outside the casino sector, but they had to take time to understand a structure that falls under two different regulatory regimes.

      Logo of Tesoro Corp.

      Investors endeavor to buy Andeavor bonds

      15 December 2017 By

      Investors went piling into Andeavor’s bond deal on Thursday, pushing final order books to US$8bn for the US$1bn two-part trade.

      Teva

      Teva inches closer to junk ratings

      14 December 2017 By ,

      Teva Pharmaceuticals inched closer to junk Thursday after Moody’s placed its rating on review for downgrade, saying new cost cuts - including slashing 14,000 jobs - were not enough.

      ECB and BoE

      ECB leaves door open for longer, bigger QE

      14 December 2017 By

      ECB president Mario Draghi stressed that the bank’s asset purchase programme might be further extended and/or increased depending on financial conditions during a press conference on Thursday, adding that at present an ample degree of monetary stimulus remained necessary.

      EU flags fly in front of the ECB headquarters in Frankfurt

      ECB changes collateral eligibility criteria for UBBs

      14 December 2017 By

      The European Central Bank has tweaked the collateral eligibility criteria for unsecured bank bonds (UBBs) in a move that is likely to discourage banks from holding other lenders’ loss-absorbing debt.

      Inter Milan fans, San Siro Stadium

      Unusual structure for Inter Milan's rare football bond

      14 December 2017 By

      Inter Milan has closed books on its €300m debut high-yield bond, brushing aside concerns about a rare structure that borrows project finance techniques.

      UniCredit

      UniCredit AT1 treads water in secondary

      14 December 2017 By

      UniCredit’s Additional Tier 1 trade was bid just below reoffer in the secondary market on Thursday morning after lower liquidity ahead of year-end seemed to take its toll on demand.

      Belgian flag

      BNPP and Credit Agricole to advise on Belgium's Green bond

      14 December 2017 By

      The Kingdom of Belgium has hired BNP Paribas and Credit Agricole to advise on its forthcoming Green bond, only the third such issue from a European sovereign.

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      Special Reports

      IFR Review of the Year 2017 IFR+RoY+Cover+2017+Homepage
      Markets, as the cliche has it, hate uncertainty. To which the only sensible response is “who doesn’t?”.

      But markets don’t seem to hate it very much at the moment.

      German Corporate Funding Roundtable 2017 IFR+German+Corporate+Funding+RT+2017+Cover
      IFR’s seventh annual German Corporate Funding roundtable, which took place in Frankfurt in early November, found participants upbeat but at the same time pensive and rather preoccupied. It was an unusual emotional juxtaposition.

      From the practice of placing a bell around the neck of a castrated ram to lead the flock

      Lloyd the millennial

      IFR 2214 16 December to 5 January 2018

      LLOYD BLANKFEIN ENDED his debut year on Twitter on a high note recently, posting a photo of himself with the social media giant’s founder, Jack Dorsey.