Commodity traders under stress

As with the old proverb about selling tea where it’s not needed, the concept of loss-absorbing bank capital is a strange one to bring to China. The Middle Kingdom has little need for a capital buffer as its banks are already beholden to the government – and vice versa. The Financial Stability Board’s decision to include China in global rules on total loss-absorbing capacity, or TLAC, is doubtless causing alarm in Beijing. China’s four biggest banks now have to raise something approaching US$550bn of loss-absorbing capital over the next 10 years. That’s the equivalent to an economy the size of Poland – or, in more regional terms, twice the size of the Philippines. The FSB is right to do so, of course. China’s Big Four are certainly big, and they are becoming more globally connected as China opens its markets and allows the renminbi to trade more freely. The TLAC rules aim to limit global contagion, so the playing field needs to be the same worldwide. Including Chinese banks, however, suggests that there is a real risk of failure. As it stands, that’s simply not true. As long as China’s banks remain organs of the state, insulating taxpayers from future bailouts makes little sense. Investors already know that the banks are too big to fail, which is why Bank of China’s Additional Tier 1 trades at 4.5%, about 100bp inside similar securities from HSBC and almost 300bp tighter than those of Societe Generale. TLAC does, nonetheless, present an opportunity for China to address that contradiction once and for all. If the banks are about to issue half a trillion dollars of extra capital, they will also need to become much more efficient at deploying it. The only solution is a full commercialisation of China’s biggest lenders: the government cannot expect regular, commercial investors to stomach losses if its policy-driven lending goes awry. China has 10 years to get its head around this conundrum. By the end of that period, TLAC may well become more relevant in China than anywhere else.

Malaysia’s moribund capital markets have sprung back to life following news of a major Chinese investment that will help repair scandal-ridden 1MDB’s balance sheet. While foreign investors are understandably still cautious, Malaysia is beginning to look like it may avert a full-blown crisis. 1MDB’s agreement to sell its Edra power unit to China General Nuclear Power Group leaves the Malaysian state investment vehicle in less immediate danger of default. That is good news for Malaysia’s economy and for its beaten-down currency, since it reduces the chances the government will need to cough up a bailout. The troubled fund’s US$3bn 2023 bonds have rebounded from their September lows. They now yield 6.4%, down from 8.8% a month ago. 1MDB will never fully restore its credibility, but after another big debt deal with Abu Dhabi earlier this year, 1MDB executives are talking about getting the fund back on track by the middle of 2016. More than avert an imminent default, however, 1MDB’s latest manoeuvre sends a political message that is far more important. Announced just hours after Chinese Premier Li Keqiang ended a visit to Malaysia, CGN’s investment shows that Malaysia has friends with deep pockets. Li pledged that China would buy more Malaysian government bonds and grant the country a US$7.8bn mainland investment quota to boost its ties with South-East Asia. He also held talks with Malaysia’s embattled Prime Minister Najib Razak, who has faced down months of calls for his resignation over corruption allegations centred around 1MDB. A new multi-billion dollar partnership with China is Najib’s latest diplomatic success, and part of a concerted effort to consolidate his position in the wake of the 1MDB scandal. By removing opponents, silencing critics and winning over political allies, Najib has effectively removed any prospect of regime change. As chairman of 1MDB’s advisory board, he also appears determined to resolve the fund’s crisis through whatever means necessary. For Malaysia’s capital markets to really get back on track, Najib will need to restore global confidence in the economy at a time when commodity prices remain deflated. If he takes to that task with the same degree of determination, a full-blown crisis looks increasingly unlikely.

Herbert Smith Freehills has hired William Ku as a debt capital markets partner, based in Hong Kong. He joins from King & Wood Mallesons, where he focused on Hong Kong and Chinese securities transactions.  Ku joins DCM partners Philip Lee in Singapore and Kevin Roy in Hong Kong and will start in early 2016.

A privately owned Chinese fund manager has become the first to receive approval to trade directly in the country’s vast interbank bond market, in a sign that regulators are looking to diversify the investor base beyond state-owned banks and insurance firms. At a time when China is opening its domestic bond market to overseas central banks, the move comes as regulators are looking to introduce more active domestic investors in a bid to improve liquidity. However, market participants say high thresholds and trading limitations mean recent regulatory changes have had little immediate impact. Genial Flow Asset Management Co, steered by former fixed-income veterans from CITIC Securities, announced earlier this month that one of its funds had received approval from the People’s Bank of China to access the interbank bond market directly. Before the central bank officially opened the interbank market to them in June, private funds could only trade the bonds through backdoor channels. Private fund managers have often used structured products to deploy their clients’ money in the interbank market. They acted as advisors to wealth management products issued by financial institutions which were able to trade and settle transactions - mainly banks, insurance companies, securities firm, public fund managers and trusts, who were managers of those products. There are some drawbacks to that approach. Private fund managers need to pay an annual fee of about 0.2% to trusts, banks, and so on, and they do not have power over banks and securities firms in terms of investment strategies. Price of independence Therefore, as private fund managers grow in size and significance they want a bigger and more independent role. But it comes at a cost. “I reckon that for private funds with assets of over Rmb10bn (US$1.6bn) under management, it is necessary for them to open direct accounts in the interbank market, otherwise it is not worthwhile,” said a Shanghai-based private fund manager, referring to costs such as building clearing platforms on their own. According to the Asset Management Association of China, by the end of October, out of 21,821 registered private fund managers, 85 managed assets of over Rmb10bn and 88 managed assets of between Rmb5bn to Rmb10bn. Moreover, regulators still appear to view private fund managers with suspicion. Some private fund managers were found to be involved in insider trading in an industry crackdown in 2013. As a result, the bar for private fund managers to gain direct access to the interbank market is set high. Private fund managers are required to have net assets of more than Rmb10m and they have to be front runners in the industry in terms of asset scale and risk controls, according to the rule published by the central bank in June. In addition, the rules limit the way private fund managers can trade bonds. They are only allowed to strike deals through market-makers rather than finding counterparts by themselves, with the assumed intent of ensuring that prices are set fairly. On top of that, the approval process is lengthy. It took Genial Flow about four months to get the green light, during which period yields fell sharply. To bridge the gap, industry participants say that private fund managers have to trade bonds listed on stock exchanges while waiting for approval to get into the interbank market. With those hurdles in place, most private fund managers are not likely to abandon their traditional approach. “It says on the paper that we can open accounts in the interbank market, but it is just a statement. There are still so many restrictions,” said a bond trader with a leading private fund. “Independence is good, but making real money matters more.”

Credit Suisse’s Chinese securities joint venture has won a brokerage licence in Shenzhen’s Qianhai district, the first secondary trading licence for a Sino-foreign JV since Beijing reopened the industry to foreign participation in 2007. In a further sign that China is opening its domestic capital markets, Credit Suisse Founder Securities is the third Sino-foreign securities JV to win a secondary trading licence after UBS Securities and Goldman Sachs Gao Hua Securities, which obtained theirs before 2007. “Through our securities joint venture, Credit Suisse now joins the ranks of a small select group of international banks which can provide onshore brokerage services to QFIIs, RQFIIs as well as mainland investors,” said Nicole Yuen, vice chairman, Greater China and head of Greater China equities at Credit Suisse. CS, which holds a 33.3% stake in CS Founder, said on November 26 that the China Securities Regulatory Commission had authorised its securities JV to expand its business scope to securities brokerage in the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone. The decision reinforces the status of Qianhai as a pilot zone in the liberalisation of China’s capital markets. Earlier in the month, HSBC announced plans for a full-licence JV in the same area, though regulatory approval is still pending. The full value of a Qianhai licence, however, is not yet clear, since the permit applies only to a zone still largely under construction. CS Founder is in the final stages of setting up its trading outlet in Qianhai and is expected to start securities brokerage services early next year, according to a statement from the Swiss bank. The JV would target institutional investors in Qianhai, a spokesperson told IFR. Local competition CS Founder’s expanded licence may provide a template for other foreign banks to expand their businesses in China’s tightly regulated domestic capital markets. Securities JVs have been struggling to make profits in the past few years, as their scope of business is very limited. Regulations prevent JV banks from engaging in businesses where their Chinese shareholders already operate. As a result, a number of JVs set up between foreign banks and local securities houses are unable to get a brokerage licences, which contribute most of the revenues for local firms. CS Founder’s approach suggests that other Sino-foreign JVs may be able to use Qianhai as an alternative to avoid such conflicts with their Chinese shareholders. According to a filing from the CSRC’s Beijing bureau, CS Founder is only allowed to provide brokerage business in Qianhai. Founder Securities, the JV’s Chinese shareholder, on the other hand, has obtained shareholder approval in 2013 to remove its brokerage operations from Qianhai, so as to clear regulatory hurdles. “Both Founder Securities and the JV will comply with the laws and regulations under the securities licensing requirements and will use best endeavours to avoid competition when conducting securities brokerage business,” CS told IFR. Brokerage services accounted for 39% of the total revenues of UBS Securities last year, bringing in Rmb327.5m (US$51m). As such, the granting of more licences could have a notable impact for securities JVs, although the benefits could be limited if this activity is restricted to one district and not nationwide. CS Founder has signed an agreement with Founder Securities to differentiate their brokerage clients so as to avoid competition with each other, according to a source familiar with the situation. That means CS Founder may not be able to lure clients freely outside the Qianhai area. CS Founder posted a net loss of Rmb25.91m on revenue of Rmb165.44m in 2014. In the first three quarters of this year, the net income of China’s securities brokerage industry totalled Rmb219bn.

Carlyle Group and TPG last week completed the sale of their five-year old investment in Australian private healthcare operator Healthscope through a A$853m (US$616m) block trade. The deal was executed last Monday at a fixed price of A$2.77 per share, or a discount of 2.1% to the pre-deal spot. The stake comprised 308.2m shares, or 17.8% of the company’s outstanding share capital. Goldman Sachs was sole adviser on the deal, which was fully underwritten. Healthscope shares closed at A$2.83 last Monday but fell sharply the following day to as low as A$2.575 before recovering marginally throughout the week. They had climbed back to A$2.74 by Friday mid-afternoon, still below the placement price. Some market participants were quick to voice doubts that Goldman had been able to sell the full amount. A source close to the deal, however, put the price drop down to some of the buyers on the block trade selling back into the market, adding that the full allocation of shares was sold mainly to international investors and those that participated in the company’s IPO. Last week’s block came soon after a 60-day lock-up period expired following the last selldown in September. At the time, TPG and Carlyle raised A$945m from the sale of a combined 350m shares, or about 53% of their Healthscope holdings, at A$2.70 per share. UBS was the sole bookrunner on that trade. Healthscope raised around A$2.3bn from its July 2014 IPO, which was priced at the top of the range. Macquarie and UBS were joint global co-ordinators. They were also joint lead managers with Bank of America Merrill Lynch, CIMB, Credit Suisse and Goldman Sachs. Carlyle Group and TPG acquired Healthscope back in 2010 for A$1.99bn, beating off competition from rival private equity groups. The acquisition was part-financed through a leveraged loan of A$1.55bn.

A lack of new issues and a wave of bond buybacks have left Asian investors worried about pricing distortions in a shrinking universe of high-yield debt. High-yield offerings have stalled this year on rising default risk in China’s slowing economy and the distressed commodities sector. Adding to that, a growing number of companies are repurchasing their debt in a bid to repair their balance sheets. In the past two weeks alone, Fortescue Metals, Yanzhou Coal Mining, Indika Energy and Berau Coal Energy have announced tender offers for bonds totalling more than US$1.1bn at face value. Investors say the lack of meaningful supply leaves them competing intensely for bonds that offer higher returns. That risks skewing pricing, making it harder for investors to compare credits based on fundamental value. “This is a big problem right now because things are becoming very technical,” said a Hong Kong-based investor who was disappointed not to receive an allocation on Beijing Properties’ recent US$300m trade. Chinese property developers have recently crept back to the offshore bond markets, but small deal sizes and heavily anchored books have made it difficult for investors to buy the bonds. Powerlong Real Estate sold Asia’s most recent high-yield bond on November 19, issuing just US$200m of 8% three-year notes. Unrated developer Beijing Properties’ US$300m 5.5% bond a week earlier was heavily anchored by onshore investors, leaving several foreign investors sidelined. The supply shortage is forcing investors to question whether the recent rebound in high-yield bonds from the Chinese property sector is driven by a fundamental improvement or by technical demand. “You’re kind of stuck with Chinese property. You can still get 8% on a Single B name, so are people going to sell – especially the real-money guys? Probably not, because they don’t have anywhere to re-invest,” said the investor. “There are a few names that people can look at in Indonesia, but I don’t think they seem attractive at these levels. That’s more for hedge funds.” Yuzhou Properties’ 8.625% December 2019s were trading around 7.7% last week, down 200bp in the past two months. Agile Property’s 9% May 2020s were spotted at 7.1%, near a record low. Despite forecasts of stronger sales next year, analysts including Moody’s have warned that rising onshore debt could leave offshore bondholders at a disadvantage. “What is important to note is potential subordination risks to come given higher onshore debt and the huge carveouts that allow the companies to issue bonds in China, especially domestic private debt,” said Raymond Chia, head of Asian credit research at Schroders. High-yield supply is unlikely to rebound in 2016, with bankers expecting PRC developers to continue favouring smaller sizes and shorter tenors, especially since they are able to access cheaper borrowing onshore. There are US$5bn of PRC property bonds maturing by the end of next year, a majority of which are sub-investment grade, and Standard & Poor’s expects most of the issuers will not issue offshore bonds to refinance them. Among the 15 offshore senior notes due in 2016, the credit rating agency forecasts that only Yuzhou, China South City Holdings, Future Land Development Holdings and Agile may be tempted to issue new offshore bonds at potentially lower yields. Buybacks by the likes of Australian miner Fortescue are also adding to the squeeze. Fortescue’s exercise met healthy demand, allowing the Australian iron ore producer to repurchase US$750m of bonds at discounts of 10%–23% to par.  Slim pickings For now, investors have few places to turn in search of higher returns. Yields on Chinese bank capital, which is expected to feature strongly next year, have plunged as local investors have warmed to the format. China Construction Bank could market an Additional Tier 1 offering as early as this week in the mid 4% area, said a banker with knowledge of the deal. Even that is a far cry from the 6.75% paid by Bank o

China’s four largest lenders face starkly higher funding costs as a result of global rules designed to prevent a collapse of banks deemed too big to fail. Having relied so far on domestic depositors and friendly local investors to fund their lending, the Big Four will need to issue hundreds of billions of dollars of capital to comply with worldwide standards on total loss-absorbing capacity, or TLAC. Restrictions on cross-holdings between banks and China’s limited institutional investor base mean much of that will have to come from the overseas markets at yields far higher than China’s banks are accustomed to paying. “It will be more challenging than the Chinese think to find buyers for this paper,” said a London-based portfolio manager at a major American asset manager. “There is a clear mismatch between the spreads they want to sell at and the spreads investors demand. Given all the volatility in the Chinese market over the course of this year, there are no natural buyers, outside of Chinese banks themselves, for this type of risk at these levels.” Estimates vary, but, in a November 24 report, Moody’s says the shortfall among China’s global systemically important banks, or G-SIBs, will be US$553bn. The figure is far more than the US$115bn in TLAC needed for US banks and the US$201bn for European banks. China’s G-SIBs are Agricultural Bank of China, Bank of China, Industrial Commercial Bank of China and China Construction Bank. CCB was added to the list at the start of November only days before the final TLAC rules were published. Capital securities Chinese lenders have a number of avenues, such as cutting risk-weighted assets and raising equity, to improve their TLAC buffers over the next 10 years, but bankers at Chinese G-SIBs say Additional Tier 1 and Tier 2 bonds will be a large part of the process. Domestic regulators have yet to decide if senior debt, which some European banks have made loss absorbing, would count towards TLAC, but analysts anticipate it will not be allowed. This points to a flood of issuance of subordinated bank capital in the coming years, raising concerns over how much the Chinese and global markets can absorb. Banks are by far the biggest buyers in China’s domestic bond market and typically support PRC issuers in the overseas markets. However, that level of support will not be available for TLAC-eligible securities, since the rules are designed to spread the risk beyond the banking system. G-SIBs will need to deduct any holdings of loss-absorbing debts from other G-SIBs from their own TLAC ratios, while Basel III rules already penalise banks for holding regulatory bank capital. That leaves overseas buyers to play a bigger role, though several global fixed-income investors have said they are uninterested. Their concerns relate to pricing, risk and transparency. Victor Rodriguez, the head of fixed income for Asia Pacific at Aberdeen Asset Management, said there was too much of an equity component in these bonds and, as such, it was not an asset class to which his firm was attracted. Others on the buyside argue that there are simply better opportunities elsewhere, both in bank capital and in other parts of Asia. As an example, ICBC currently has US$2bn Baa3 rated 10-year Tier 2 bonds yielding 4.699%, while Macquarie has a Baa3 T2 quoted at 4.834%. National team China’s banks only began issuing loss-absorbing capital in 2013 and previous issues of AT1 securities have relied heavily on PRC insurers and other state-owned enterprises as buyers. It is difficult to estimate how much more these companies can buy, but some, such as China Huarong Asset Management and China Life Insurance, do have vast balance sheets. China Life’s 2014 annual report shows it has total investment assets of Rmb2.1trn (US$328bn) – Rmb940bn of which is in bonds. While meeting the TLAC requirements poses a challenge, a crucial advantage the Chinese G-SIBs have is time. They have until 2025 to reach the first benchmark of 16% of risk

Chinese steelmaker Baosteel gave the sleepy Asian equity-linked market a year-end jolt last week with an issue of US$500m three-year bonds exchangeable into China Construction Bank H-shares. The issuer was Baosteel Hong Kong Investment, but the EBs come with a keepwell and liquidity support deed from unlisted parent Baosteel Group, rated A3/A–/A–. This was the first equity-linked instrument in Asia to use a keepwell structure, the first equity-linked issue with underlying shares in a Chinese bank, and the first offshore equity-linked issue from Baosteel. As a rare equity-linked issue from a Chinese state-owned company with a strong credit profile, the offering drew strong support from investors. “The deal was well sought after because of its scarcity value. Many investors wanted to get exposure to a strong Chinese credit. The fact that the underlying stock, China Construction Bank, is very liquid also helps,” said a source close to the deal. The EBs carry a zero coupon/yield-to-maturity and were offered at an exchange premium of 38.5%–45.0%. The premium was set at the bottom of the range at 38.5%, the highest on such an Asian issue since Beijing Enterprises priced a HK$4.3bn (US$556m) EB at 42.78% in June 2014. The book featured more than 40 investors, including both outright buyers and hedge funds. Demand was evenly split between Asia and Europe. The top 10 investors took about half of the issue. More to come The positive response to the Baosteel issue set a positive tone for the much anticipated equity-linked transactions of CRRC, China’s top rolling-stock manufacturer, and China Railway Construction Corporation. Both companies are looking to raise up to US$1bn each through the issuance of H-share convertible bonds. Bankers expect at least one of them will hit the market before the end of the year. “The response for the Baosteel deal is important as it can shed some light on how much investors are willing to pay for China SOE credit,” said a banker who has pitched for both transactions. The potential CB issuances of CRRC and CRCC are taking advantage of recent rule changes in China regarding selling offshore debt. In mid-September, China’s National Development and Reform Commission issued a set of new guidelines on offshore debt issuance. Companies will no longer need to go through a lengthy approval process. Instead, they can simply register with the NDRC and the regulator will approve the applications within five working days. Baosteel’s EBs traded at 99.60–99.70 in the secondary market a day after the issuance, and climbed back to 99.9 last Thursday. At 38.5%, depending on the stock-borrow cost and credit-spread assumption, the value of the EBs theoretically came in below par at around 99.80. The credit spread was assumed to be 180bp, the implied volatility 30.3% and the bond floor 91.30. Proceeds will be used for business expansion and future offshore investments, as well as other general corporate purposes. HSBC and UBS were the joint global coordinators and active bookrunners. The other bookrunners were Barclays, BOC International, Citigroup, CCB International, China Merchants Securities, CMB International and Morgan Stanley. China’s second-largest steelmaker in terms of production has been looking to offload its non-core investments through different channels. In December 2014, Baosteel Group sold a Rmb4bn (US$650m) three-year exchangeable in the domestic market.

Chinese peer-to-peer online lending platform Lufax, which has the backing of Chinese insurer Ping An Insurance, is looking to do a Hong Kong IPO in 2016. According to sources familiar with the situation, the company has not mandated any banks on the transaction yet. However, Goldman Sachs and Morgan Stanley, which are currently arranging another round of pre-IPO financing for the company, are likely to have key roles on the float. Lufax completed a round of financing in April, valuing the company at round US$10bn. The valuation of the company in the latest round of financing is unclear. The IPO is preliminarily estimated to raise about US$3bn–$5bn, according to one sourc.

Despite all the hype around the format, India’s dreams of developing a global rupee-linked bond market hinge on bridging a gulf in pricing expectations between issuers and investors. India’s largest power producer, state-owned NTPC, had been expected to print the first offshore rupee, or Masala, bonds this week, but the buyside and the sellside are said to be looking at yields as much as 100bp apart, calling that timeline into question. The disconnect risks souring the launch of a market that, if things go well, could raise up to US$5bn for Indian borrowers in the next two to three years, luring new investors into Indian credit and providing cost savings to issuers. DCM bankers knowledgeable about NTPC’s roadshow said investors were demanding a huge liquidity premium for Masala bonds. “We were shocked when some big investors asked for as much as 100bp more than what NTPC will pay for its onshore bonds,” said a DCM banker. “These investors know NTPC very well, but they are also aware that this market will be illiquid initially.” As investors are taking the currency risk on these bonds, they also want to be adequately compensated. According to local DCM bankers, NTPC will be able to print five-year onshore bonds in the 8.10%–8.15% range. “Even if any Indian issuer is able to raise local money at 8%, in the Masala market this becomes 8.40% after taking into account the 5% withholding tax that a borrower is supposed to pay,” said a Singapore-based investor, dismissing issuers’ expectations of tighter Masala pricing as totally unfounded. NTPC, globally rated Baa3/BBB–/BBB–, kicked-off its roadshow in London early last week before meeting investors in Singapore and Hong Kong. Barclays, Citigroup, Deutsche Bank, HSBC and SBI Capital Markets will lead the Masala offering off a US$4bn MTN programme. HDFC also kicked off investor meetings in Asia on November 17 via Barclays, Citigroup, Credit Suisse, HSBC and JP Morgan before holding a final presentation in London on November 26.* Sources say investors want HDFC to pay at least 25bp–50bp more for Masala bonds than its onshore rupee notes. “HDFC wants to print an unrated Masala bond. This has not gone down well with some investors,” said a DCM banker. HDFC is able to raise five-year money in the local bond market at around 8.30%. NTPC and HDFC are both locally rated Triple A. Some DCM bankers are still hopeful that the first Masala bonds from an Indian corporate will be launched soon. “It’s a new market, so there is bound to be a lot of uncertainty, but we are here to mediate and arrive at a sweet spot on pricing”, said a DCM banker with a foreign bank. Lingering optimism In sharp contrast to investor trepidations, arrangers are scrambling to get in the action, judging from the response that state-owned India Infrastructure Finance and Indian Railways Finance received to their invitations to bid for potential Masala offerings. According to DCM bankers, 17 arrangers put in their bids on November 23 for IIFCL’s potential offering. These include 12 foreign lenders, namely ANZ, Barclays, BNP Paribas, Bank of America Merrill Lynch, Credit Suisse, Citigroup, DBS, Deutsche Bank, HSBC, JP Morgan, Nomura and Standard Chartered, and five Indian lenders, Axis Bank, IDFC Bank, ICICI Bank, SBI Capital Markets and Yes Bank. For IRFC, 12 arrangers put in bids on November 20. Both these issuers may announce mandates this week. Among other expected Masala issuers are conglomerate JSW Group, infrastructure company GMR Group, Indian non-banking finance companies and local units of multinationals, such as ABB and Siemens. “NBFCs are looking to bolster their balance sheets ahead of an expected pick-up in demand for automobile and home loans,” said a banker. Among the NBFCs talking to arrangers are Indiabulls Housing Finance and Shriram Transport Finance. DCM bankers are optimistic that, assuming a few Masala notes are launched successfully, India may also look to allow companies to float rupee-linked offshor

Indian state-owned power producer NTPC has sent out a request for proposals for a US$250m seven-year loan with a greenshoe option of up to US$250m. The deadline for responses is the third week of December. The borrower, India’s largest power company, had sent out an RFP earlier in June for a refinancing loan of US$100m with a tenor of more than three years. Mizuho Bank, which was tipped for the mandate, provided a bilateral loan to the borrower. Mizuho was also the MLAB on the borrower’s US$250m seven-year loan signed in September last year. Sumitomo Mitsui Trust Bank joined that loan as a lead arranger. In March 2012, NTPC obtained a US$100m seven-year bilateral term loan from Mizuho, according to Thomson Reuters LPC data. NTPC, formerly National Thermal Power Corp, is engaged in power generation, consultancy, project management, oil-and-gas exploration, and coal mining.