Taiwan Loan House: CTBC Bank

IFR Asia Awards 2022
2 min read
Aileen Chuang

Renewed energy

CTBC Bank outperformed its rivals in 2022, leading renewable energy and major event-driven loans in Taiwan as well as playing a key role in arranging sustainable financings overseas.

CTBC was the sole coordinator among 11 banks – including four new lenders – participating in a NT$34bn-equivalent (US$1.14bn) five-year facility that refinanced and recapitalised KKR’s leveraged buyout of LCY Chemical in June.

The borrowing, one of Asia’s few leveraged financings linked to environmental, social and governance metrics, achieved a strong outcome considering LCY’s history. The Taiwanese chemicals maker had suffered reputational damage because of a gas pipeline explosion in 2014 and the bankruptcy of its solar power unit, Taiwan Polysilicon, in 2015.

The bank broke new ground with Taiwan’s first waste-fuelled power plant project financing in July – a NT$4.056bn seven-year borrowing for infrastructure-focused private equity firm I Squared Capital. The loan for the 20MW waste-to-energy power plant in Taoyuan city, the first privately owned facility of its kind in Taiwan, attracted eight other banks in general syndication upon closing in August.

The same month, CTBC, as sole bookrunner, wrapped up a NT$3bn seven-year loan for local sponsor Yang Bao Enterprise’s waste-to-energy project, which closed with seven lenders joining.

“Our main focus has been on renewable financing, ie, providing tailor-made solutions to offshore wind, solar power and waste-to-energy projects in the home market, which manifests our commitment to the ESG agenda,” said Matthew Liaw, head of CTBC’s global structured finance division.

In May, CTBC closed a US$640m five-year loan for the buyout of Taiwan’s largest contact lenses maker, Ginko International, from Baring Private Equity Asia and Ginko’s major shareholders.

CTBC was one of the nine mandated lead arrangers and bookrunners of the borrowing, which was Taiwan’s first sustainability-linked leveraged financing and attracted another 15 lenders in syndication.

CTBC also showcased its capabilities with a sole bookrunner role on a NT$4bn five-year loan that backed Bora Pharmaceuticals’ acquisition of domestic peer TWi Pharmaceuticals. The financing drew a solid response from half a dozen lenders before closing in September.

Two-thirds of the 70 loans that CTBC completed as MLAB and MLA in 2022 were sourced from overseas markets. Notable among them was Hong Kong-based conglomerate Chow Tai Fook’s HK$10bn-equivalent (US$1.27bn) debut sustainability-linked loan for which CTBC was among the leads and the SLL co-adviser.

It also won an MLAB role on a US$1.1bn social loan for India’s Housing Development Finance Corp, pulling nine Taiwanese banks into the world’s biggest such financing.

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