IFRASIA INTERNATIONAL FINANCING REVIEW ASIA OCTOBER 7 2017 ISSUE 1012 www.ifrasia.com Qudian quickly covered as buyers flock to China’s biggest US fintech IPO India sets high target for GIC Re after cool trading debuts for local insurers South Korean issuers court debt investors after missile tests trigger heavy selling PLUS: QUARTERLY LEAGUE TABLES BONDS LOANS LOANS PEOPLE & MARKETS Samurai market NTPC breaks new SoftBank launches Chinese banks shrinks as swap ground in yen Asia’s largest retain top spots on costs deter high- market with first syndication to repay Asian investment rated issuers 10-year tenor acquisition debt banking fees 06 08 08 14 1012_00 Cover.indd 3 06/10/2017 21:46:20 WANT A GLOBAL PERSPECTIVE ON THE SYNDICATED LOAN MARKET? LOOK TO THOMSON REUTERS LPC Thomson Reuters LPC is the premier global provider of information on the syndicated loan and high yield bond markets. Our first-to-the-market news and comprehensive real-time and historical data help industry players stay informed about market trends and facilitate trading and investment decisions. LPC’s publications, end-of-day valuations, online news, analysis, and interactive databases are used every day by banks, asset managers, law firms, regulators, corporations and others to drive valuation, syndication, trading, research and portfolio management activities. CONNECT TO THE GLOBAL SYNDICATED LOAN MARKET WITH THOMSON REUTERS LPC. www.loanpricing.com [email protected] Upfront OPINION INTERNATIONAL FINANCING REVIEW ASIA Model of success Global banks have proven their value in 2017, and will be looking to build on their successes in 2018. The model lobal banks are doing a decent job of hanging on works, but it’s not clear for how long. to market share in Asian investment banking, at G least according to the 2017 league tables. The battle, however, isn’t going to get any easier. Still on hold Asia’s local banks have eaten away at margins and distorted economics in primary capital raising in recent f anyone thought that India’s overhaul of its insolvency years, but the hype has taken a back seat to reality in the code might speed up debt resolutions, this week’s lRSTûTHREEûQUARTERSûOFûTHEûYEARû&OURûOFûTHEûTOPûlVEûEQUITYû I developments at one of the country’s biggest companies UNDERWRITERSûINû!SIAû0ACIlCûAREûGLOBALûBANKS ûANDûTHEûTOPûû suggest otherwise. G3 bond houses include just one regional player, with Bank It had all started so well – the Reserve Bank of India put of China in seventh spot. pressure on banks to recognise the true scale of their bad 'RANTED ûTHEûCURBSûONû#HINESEûOUTmOWSûMAYûHAVEû loans, and then forced them to start insolvency proceedings temporarily distorted the tables in favour of international AGAINSTûSOMEûDELINQUENTûBORROWERSû%SSARû3TEEL ûWHICHû arrangers. But it’s also true that local competitors have not DEFAULTEDûBACKûINû ûQUICKLYûSOLDûAûPORTûASSETûTOûREPAYû yet managed to unseat their global rivals on block trades creditors. and high-yield bonds. Measures allowing creditors to take control of defaulters Unfortunately for the likes of Goldman Sachs, it’s only a THROUGHûEQUITYûCONVERSIONûWEREûALSOûDESIGNEDûTOûSHOCKû borrowers into staying current on their interest payments. Reliance Communications, though, is dragging its feet, and its lending banks share some of the responsibility. Local competitors have not In June the troubled telco entered a standstill yet managed to unseat their arrangement with its lenders, giving it until the end of the year to complete divestments it had already announced, and global rivals on block trades allowing it to reduce debt to a sustainable level. Last week, though, it called off a merger of its wireless and high-yield bonds. unit and said a sale of a stake in its tower business would be delayed. Buried in the middle of one of the announcements was a note that its debt standstill had been extended to the matter of time before that changes. end of 2018. !SIANûINVESTMENTûBANKINGûISûATûANûINmECTIONûPOINTû If banks really think that they will maximise value by Companies across the region are embracing the capital giving RCom more time and allowing it to negotiate new MARKETSûASûNEVERûBEFORE ûANDûRISINGûLOCALûPROlTSûMEANû sale terms, then that makes sense, but the casual nature of OVERSEASûACQUISITIONSûAREûNOWûONûTHEûTABLE the announcement raises concerns that lenders are again But Asia is still primarily about relationship banking, avoiding tough decisions. WHEREûlNANCEûANDûPRICEûOFTENûTRUMPûIDEASûANDûADVICEû!Sû RCom and its founder, Anil Ambani, are corporate royalty regional lenders expand into underwriting and advisory INû)NDIA ûWHEREûBANKSûAREûlNDINGûITûHARDûTOûBREAKûTHEIRûOLDû business, global banks will need to put their balance sheets bad habits. Lenders may even be hoping that his brother, to work to remain competitive. It’s perhaps notable that Mukesh, will ultimately bail out his sibling, even though Citigroup and HSBC rank highest among global banks by it was his upstart telco, Reliance Jio, that contributed to overall investment banking revenues so far this year. RCom’s predicament. The rise of the Asian investor, too, will challenge the This is exactly the kind of thinking that contributed to global model. It’s already clear that companies can issue THEûASSETûQUALITYûPROBLEMSûATûTHEûCOUNTRYSûBANKSû.OWû billions of US dollars in bonds without the help of a single that creditors no longer face decade-long court battles to 53ûORû%UROPEANûINVESTORû)FûTHEûEQUITYûBLOCKûTRADESûOFûTHEû collect on debts, they need to make sure they use their new future involve Chinese shareholders and Chinese buyers, RIGHTSûANDûTREATûALLûBORROWERSûEQUALLY ûREGARDLESSûOFûSIZEûANDû why go with a non-Chinese bank? INmUENCE International Financing Review Asia October 7 2017 1 INTERNATIONAL FINANCING REVIEW ASIA CONTACTS EDITOR EDITOR, IFR COMPANY INDEX Japan Retail Fund Investment Corp 29 Steve Garton Matthew Davies 21Vianet Group 23 JTEKT Corp 29 +852 2912 6670 +44 (0)20 7542 7504 [email protected] DESK EDITOR ACME Solar 26 Kepco 6 HEAD OF ASIAN CREDIT Vincent Baby Alliance Bank Malaysia 30 Kia Motors 6 Daniel Stanton SUB-EDITOR +65 6417 4548 Anyou Biotechnology Group 24 KK A-Wind Energy 29 Dharsan Singh ASIA EQUITIES EDITOR Apollo Tyres 27 Koh Brothers Group 33 Fiona Lau HEAD OF PRODUCTION AU Optronics Corp 9 +852 2912 6673 Victor Ng Lao People’s Democratic Republic 35 PRODUCTION ASSISTANT Auckland International Airport 21 DEPUTY HEAD OF ASIAN CREDIT Lemon Tree Hotels 27 Mike Tsui Frances Yoon Australian Office of Financial Macronix International 34 +852 2841 5783 HEAD OF GLOBAL ADVERTISING AND Management 10 DEPUTY EQUITIES EDITOR, ASIA SPONSORSHIP Malaysia Airports Holdings 30 S. Anuradha Shahid Hamid Bank of Qingdao 24 +65 6417 4547 +65 9755 5031 Maxi-Cash Financial Services Corp 33 Banque Federative du Credit Mutuel 30 SENIOR CREDIT CORRESPONDENT, ASIA IFR ASIA AWARDS MANAGER MotorCycle Holdings 22 BCPE Madison Cayman LP 29 Kit Yin Boey Paul Holliday Noble Group 34 +65 6417 4549 +44 (0)20 7542 8018 Beach Energy 22 NTPC 8 ASIA PACIFIC BUREAU CHIEF, LOANS GLOBAL ADVERTISING Bright Food (Group) 22 Prakash Chakravarti PRODUCTION MANAGER Power Finance Corp 25 +852 2912 6671 Gloria Balbastro Cairn India Holdings 26 PropertyGuru 34 SENIOR REPORTERS: HONG KONG +44 (0)20 7542 4348 China Aircraft Leasing Robert Hartley SUBSCRIPTION SALES ENQUIRIES Group Holdings 24 Province of Alberta 21 +852 2841 5768 China, Hong Kong, Taiwan, Korea, Japan Qudian 4 Thomas Blott Alan Wong China Citic Bank 23 +852 2841 5878 +852 2912 6606 China Tian Lun Gas Holdings 25 Queensland Treasury Corp 21 Carol Chan India, Singapore, Malaysia, Thailand, Citic Envirotech 32 Reliance Communications 10 +852 2912 6604 Indonesia and Australia CW Advanced Technologies 34 EQUITY RESEARCHER: BEIJING Samantha Harris Reliance Industries 26 Ken Wang +612 9373 1749 DONG Energy A/S 9 Reliance Jio Infocomm 26 +86 10 6627 1259 SUBSCRIPTION ACCOUNT MANAGER Dongfeng Nissan Auto Finance 23 Saka Energi Indonesia 27 SENIOR REPORTER: SYDNEY Pia Batuan John Weavers Emperor International Holdings 24 +65 6403 5542 Seven Islands Shipping 27 +61 2 9373 1655 Export-Import Bank of Korea 6 SIA Engineering 34 SENIOR ANALYST: TOKYO CLIENT SERVICES Ezion Holdings 32 Takahiro Okamoto [email protected] Singapore Airlines 33 +813 6441 1773 WEBSITE Frasers Centrepoint 33 SoftBank Group 8 ASIAN CREDIT CORRESPONDENT www.ifrasia.com Garuda Food Group 27 Krishna Merchant Spark Finance 21 EMAIL ADDRESSES +65 6417 4544 General Insurance Corp of India 4 [email protected] Standard Life Aberdeen 31 REPORTER: HONG KONG Genting Singapore 31 Ina Zhou Sumitomo Mitsui Financial Group 29 Global Cloud Xchange 10 +852 2912 6674 Taiwan-Japan Oxo Global Logistic Properties 23 Chemical Industries 9 Global Power Synergy 35 GSH 33 Toshiba Memory Corp 30 Heritage Bank 21 Union Bank of the Philippines 30 HONG KONG (HEAD OFFICE) SINGAPORE 16/F Cityplaza 3, 18 Science Park Drive, Hindustan Aeronautics 26 Uxin 24 14 Taikoo Wan Road, Singapore 118229, Singapore Taikoo Shing, +65 6775 5088 Indian Oil Corp 8, 25 Vedanta Resources 26 Hong Kong Invincible Investment 29 Winbond Electronics 9 +852 2843 6363 LONDON 30 South Colonnade, Canary Wharf, TOKYO London E14 5EP 30F Akasaka Biz Tower, +44 (0)20 7250 1122 5-3-1 Akasaka, NEW YORK Minato-ku, Tokyo, 3 Times Square, 18th Floor Japan 107-6330 MAKE THE MOST OF New York, NY10036 +813 6441 1119 +1 646 223 4000 YOUR SUCCESS STORIES IFR Asia is a sister publication of International Financing Review. The contents of this For information on