COUNTRY REPORT CHINAin the name of wholly owned subsidiary
Tewoo Group No 4 with Tewoo Group as
guarantor.
› XINDA HIRES FOR DOLLAR SENIOR
Chinese coke producer ZHONGRONG XINDA
GROUP, rated BB–/BB (S&P/Fitch), has hired
banks for a proposed offering of Reg S US
dollar senior notes.
China Citic Bank International, HSBC, ABC
International and Industrial Bank, Hong Kong
branch, are joint global coordinators. The
four are also joint bookrunners and joint
lead managers with BoCom International,
Haitong International, Zhongtai International,
China Industrial Securities International and
AMTD.
The Shandong-based company will meet
investors in Singapore and Hong Kong,
starting Monday.
The proposed notes will be issued
in the name of subsidiary Zhongrong
International Resources, while Zhongrong
Xinda Group and certain subsidiary
guarantors will serve as guarantors.
The notes have expected ratings of BB–/
BB (S&P/Fitch).
› ICBCA PLANS RMB2BN PANDASINDUSTRIAL AND COMMERCIAL BANK OF CHINA (ASIA)
plans to raise Rmb2bn from the sale of
debut Panda bonds, according to market
sources.
The lender aims to issue the one-year
notes sometime this month in China’s
interbank bond market, sources have said.
The issue will follow the last financial
Panda bonds from Bank of China (Hong
Kong). Last month, BOC (HK) printed the
largest single Panda bonds to date, raising
Rmb9bn at a one-year maturity.SYNDICATED LOANS
› TEN ON SHIPBUILDER'S LOANA maiden US$200m three-year financing
for YANGZIJIANG SHIPBUILDING (HOLDINGS) has been
allocated as 10 banks joined in general
syndication.
BNP Paribas and Standard Chartered are
mandated lead arrangers and bookrunners
on the bullet loan, which pays a top-level
all-in pricing of 140bp, based on an interestmargin of 127bp over Libor. The loan will
be signed soon.
Subsidiary Yangzijiang International
Trading is the borrower. The borrower
and the parent are guarantors on the loan,
which also carries a demand guarantee from
China Export & Credit Insurance Corp, or
Sinosure. Funds were for refinancing.
Yangzijiang Shipbuilding, engaged in
shipbuilding and offshore engineering, is
headquartered in China’s Jiangsu province.
For full allocations, see http://www.ifrasia.com.› CHINA XD BACK FOR TWO-YEAR FACILITYCHINA XD PLASTICS is seeking a two-year
US dollar term loan and hired Standard
Chartered as coordinator for a site visit last
Friday to Sichuan province’s Nanchong city.
The Nasdaq-listed company signed a
US$180m two-year amortising loan in
August 2016. StanChart was the mandated
lead arranger and bookrunner on that
facility, which paid a top-level all-in pricing
of 400bp, based on an interest margin of
260bp over Libor and a 1.78-year average
life. Xinda Holding (HK) was the borrower,
while China XD and subsidiaries FavourBank of Zhengzhou prints US$1.191bn AT1s
Bonds Third such issue from Chinese lenders in international market in one monthBANK OF ZHENGZHOU last Tuesday priced
US$1.191bn of US dollar Additional Tier 1
securities, the third such issue in a month
from a Chinese lender in the international
bond market.
The unrated Reg S perpetual non-call five
notes from the Chinese city commercial bank,
based in central Henan province, were priced
at par to yield 5.5%, tightening from initial
guidance in the 5.7% area.
The structure, pricing and issue size
were almost a carbon-copy of peer Bank of
Qingdao’s trade.
“Bank of Zhengzhou, from the outset,
targeted pricing at least in line with Bank
of Qingdao’s deal,” said a banker on the
offering.
On September 12, Bank of Qingdao priced
US$1.203bn of AT1s at 5.5%, also tighter
than initial guidance of 5.7% area.
CreditSights said Bank of Zhengzhou’s
AT1s should trade slightly tight to those of
Bank of Qingdao due to its larger asset size,
partly offset on slightly weaker balance-sheet
metrics. The research firm put fair value at
5.3%.
In addition to the two city commercial
lenders, Postal Savings Bank of China (A2/A/A+) printed US$7.25bn of AT1s on September- This was Asia’s largest bank capital
offering and the biggest single-tranche US
dollar bond issue in Asia this year.
Final order statistics on the Bank of
Zhengzhou issue had not been disclosed at
the time of writing, but the banker said orders
were over US$2.1bn when final guidance was
released. Like other Chinese lenders to issue
offshore AT1s, a large part of the orders were
from mainland investors, he said.
“It was not a secret, Chinese investors,
no matter whether banks, corporates,
asset management or private banks, were
dominant,” he said.
The debut AT1s traded up and were
bid at 100.25 in the secondary market
last Wednesday, the first day of trading,
according to a trader.
A trigger event would occur if the Chinese
lender’s core Tier 1 capital adequacy ratio fell
to 5.125% or below, or the earlier of either
the China Banking Regulatory Commission
deemed the bank non-viable without a
conversion or write-off, or a public-sector
injection of capital was necessary.
If a trigger event occurs, the issuer
would have to convert all or some of the
outstanding AT1s into ordinary H-shares at
the effective conversion price, initially set at
HK$5.38 each.
The bank’s H-shares closed at HK$4.53
last Tuesday. Its Core T1 CAR stood at 8.59%
as at end-June.
CMB International, China Silk Road
International, Citic CLSA Securities, CCB
International, Central China International
Capital and Huarong Financial were joint
global coordinators on the AT1 offering.
The six banks are also joint bookrunners
and joint lead managers with ICBC (Asia),
China Industrial Securities International,
BoCom International, Guotai Junan
Securities (Hong Kong), SPDB International,
Haitong International, Southwest Securities
International, AMTD, China Merchants
Securities (HK), ABC International, CM
Securities, Orient Securities (Hong Kong),
Zhongtai International, CICC HK Securities,
BOC International, UBS, Ping An of China
Securities (Hong Kong) and BNP Paribas.
Four bookrunners, namely AMTD, CICC
HK Securities, BOC International and Orient
Securities (Hong Kong), were added after the
release of final guidance.
CAROL CHAN