ASIA-PACIFIC
CHINA
HUACHEN SELL-OFF ON PARENT DEFAULTPower-plant operator HUACHEN ENERGYSû
53MûûBONDSûDUEûûPLUNGEDû
ûPOINTSûTOûAûCASHûPRICEûOFûûONû&RIDAYû
after its Shanghai-listed parent WINTIME
ENERGY defaulted on onshore bonds.
)NûAûSTOCKûEXCHANGEûlLINGûONû&RIDAY û
7INTIMEûSAIDûITûHADûFAILEDûTOûMAKEû
REPAYMENTûONû2MBBNû53M ûû
DAYûCOMMERCIALûPAPERûDUEûONûULYûû
The principal and interest due totalled
2MBBN
4RADINGûOFû7INTIMESûSHARESûANDûITSû
other onshore bonds has been halted from
ULYû
7INTIMEûSAIDûITûWASûTAKINGûACTIONSûTOû
RAISEûFUNDSûTOûREPAYûTHEûDEBTû4HEûCOMPANYû
HADûPREVIOUSLYûSAIDûITûPLANNEDûTOûAPPLYûFORû
NEWûCREDITûFACILITIESûFROMû#HINAû#ITICû"ANKû
and Ping An Trust, and to issue new
onshore bonds.
Huachen, which issued its debut US
DOLLARûBONDûLASTû-AY ûISûRATEDû"ûBYû
-OODYSûANDûITSûûBONDSûAREûRATEDû"
Its bonds had seen selling pressure since
LATEû-AYûAFTERûTHEû3HANGHAIû3TOCKû
%XCHANGEûQUESTIONEDû7INTIMESûPOTENTIALû
LIQUIDITYûRISKû4HEûBONDS ûWHICHûWEREûSTILLû
TRADEDûATûABOVEûTHEûûLEVELûINûMID
-AY û
had fallen to around 68 late last month,
according to a bond trader.
JIUDING FIXES CONSOLIDATION DELAYJIUDING GROUP FINANCE has secured consent
FROMûHOLDERSûOFûTHEû53Mûûû
ADDITIONALûBONDSûITûISSUEDûLASTû/CTOBERûVIAûAû
TAPûTOûRESOLVEûAûCONSOLIDATIONûDELAY
"ONDHOLDERSûAGREEDûONû*ULYûûTOûAMENDû
certain terms of the notes to make them
fungible with the original bonds in the same
LINE ûACCORDINGûTOûAûSTOCKûEXCHANGEûlLING
The bonds, issued via a reopening on
/CTOBERû ûWEREûSUPPOSEDûTOûBEû
CONSOLIDATEDûWITHûTHEûORIGINALû53Mû
ûLINEûISSUEDûONû*ULYûûûONûORûAFTERû
&EBRUARYûû ûBUTûTHISûWASûDELAYEDûDUEûTOû
hTECHNICALûISSUESv ûAûBANKERûWHOûWASû
involved in the deal told IFR earlier.
It is rare that bonds issued from a tap are
not made fungible with the original bonds
after such a long time, another banker had
said.
Jiuding Group Finance on June 8 launched
a consent solicitation to amend the termsand conditions of the additional bonds and
the supplemental trust deed between the
ISSUER ûTHEûGUARANTORûANDû#ITICORPû
International as trustee, to authorise the
consolidation into a single series.
4HEûEXTRAORDINARYûRESOLUTIONûWASûDULYû
passed in the meeting with bondholders on
*ULYûû2ELATEDûPARTIESûHAVEûENTEREDûAûSECONDû
supplemental trust deed and the additional
bonds are expected to be consolidated and
form a single series with the original notes
ONûORûBEFOREû*ULYû ûACCORDINGûTOûTHEûlLING
The Reg S senior unsecured bonds, rated
""ûBYû30 ûCARRYûAûGUARANTEEûFROMûTHEû
ISSUERSûPARENT û4ONGCHUANGJIUDINGû
Investment Management Group.
4HEûBONDSûHAVEûFALLENûBYûMOREûTHANûû
points since March and were quoted at
ûONû*UNEû ûTHEûDATEûONûWHICHûTHEû
consent solicitation was launched. The
BONDSûWEREûQUOTEDûATûûONû*ULYû û
according to Thomson Reuters data.
4ONGCHUANGJIUDINGûISûLISTEDûONû#HINASû
.ATIONALû%QUITIESû%XCHANGEûANDû1UOTATIONSû
THIRDûBOARD û(ONGû+ONGûINSURERû&4û,IFEû
)NSURANCE û#HINESEûBROKERAGEû*IUZHOUû
3ECURITIESûANDûPRIVATEûEQUITYûlRMû+UNWUû
Jiuding Investment Holdings are some of its
major operating units.FITCH DOWNGRADES GANGTAI GROUPReal estate developer and jeweller GANGTAI
GROUP, which issued a debut US dollar bond
INû-ARCH ûWASûDOWNGRADEDûBYû&ITCHûANDûISû
facing a possible further downgrade.ALL INTL EMERGING MARKETS BONDS
BOOKRUNNERS: 1/1/2018–30/6/2018
Asia-Pacific
Managing No of Total Share
bank or group issues US$(m) (%)
1 HSBC 123 13,735.25 8.2
2 Citigroup 64 8,681.42 5.2
3 Bank of China 92 8,422.28 5.0
4 Standard Chartered 73 7,228.56 4.3
5 Morgan Stanley 36 7,114.63 4.2
6 BNP Paribas 52 6,480.41 3.9
7 Credit Suisse 43 5,492.28 3.3
8 Citic 55 5,210.77 3.1
9 BAML 38 4,720.07 2.8
10 Deutsche Bank 44 4,718.45 2.8
Total 361 167,634.46
Excluding equity-related debt.
Source: Thomson Reuters SDC code: L4ALL INTL EMERGING MARKETS BONDS
BOOKRUNNERS: 1/1/2018–30/6/2018
Managing No of Total Share
bank or group issues US$(m) (%)
1 Citigroup 140 34,649.04 9.8
2 HSBC 175 29,724.31 8.4
3 JP Morgan 89 20,952.24 6.0
4 Deutsche Bank 71 20,109.96 5.7
5 Standard Chartered 113 18,868.67 5.4
6 BNP Paribas 81 13,534.77 3.8
7 BAML 63 11,008.54 3.1
8 Morgan Stanley 50 10,318.39 2.9
9 Credit Suisse 61 9,934.27 2.8
10 Bank of China 96 9,882.17 2.8
Total 557 351,774.36
Excluding equity-related debt.
Source: Thomson Reuters SDC code: L1
Tough months ahead for
Asian HY
ASIA High-yield issuance tumbles in Q2, as new-issue premiums soarAsian high-yield credit markets face another
tough six months amid expectations that the
volatility that rocked issuance in the first half will
continue at least until year-end.
Rising interest rates, a flood of offshore supply
from China and weak secondary markets have
dampened demand for Asian high-yield debt in
the first half of 2018.
With the US Federal Reserve expected to stick
to its monetary tightening cycle for this year and
next, and concerns about rising defaults in China
and a wave of maturities due from next year,
investors are treading carefully, particularly as
secondary trading levels continue to face selling
pressures.
Asian high-yield volumes dropped only slightly
to US$21.7bn in the first half of this year from
US$23.7bn in the same period in 2017, according
to Thomson Reuters data.But the pace of issuance tumbled in the
second quarter, with high-yield volumes down
22% year-on-year, the data showed. The average
yield on a five-year Asian US dollar high-yield
bond touched 7.86% last week, the highest level
since July 2013, according to Thomson Reuters
data.
Much of this year’s issuance has come in a
weak market, despite a bullish start that bankers
said had initially come as a surprise. In the first
quarter, high-yield volumes were actually up 7%
year-on-year.
“The first few weeks of 2018 were really a
seller’s market - you could bring almost anything
at any time,” said Haitham Ghattas, head of debt
origination for Asia at Deutsche Bank.
“What we saw in late first quarter and early
second was a market of windows, with a flurry of
activity backing up secondary levels and leading