Ifr 1510

OCTOBER 15 2022 ISSUE 2455 www.ifre.
com
Investors call for Bank of England to

U-turn on Gilt sales, as UK chaos continues
Bankers fret over leveraged finance maturity

wall and urge issuers to get in early
Head to head: European Union outshines

Germany in long-end euros
BONDS STRUCTURED FINANCE EQUITIES PEOPLE & MARKETS

Further UK panic European ABS All is forgiven: Banks work out
ensnares sterling still standing China’s Kanzhun how to work out
corporate bond after secondary lLESûFORû(ONGû emissions from
market deluge Kong listing underwriting
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Upfront
OPINION INTERNATIONAL FINANCING REVIEW
Dear oh dear Out of options
U sually if the US sneezes, the rest of the world catches a

cold. Over the past fortnight or so, though, it’s the UK’s
sickness that has been driving global market sentiment.
% ARLYûTHISûYEARûITûSEEMEDûASûTHOUGHûTHEûTOPûTIERûOFû#HINESEû
property developers had found a solution to their
liquidity problems. It turned out to be a false dawn.
While it’s unsurprising that analysts and commentators in With the offshore bond market out of bounds as defaults
"RITAINûAREûTRANSlXEDûBYûTHEûCOUNTRYSûSELF INmICTEDûCRISISûITSû MOUNTEDûINûTHEûPROPERTYûSECTORûINû*ANUARYû#OUNTRYû'ARDENû
a rare occasion that policymakers elsewhere get so interested Holdings sold a HK$3.9bn (US$497m) convertible bond issue
in the UK’s troubles. But in this instance there’s good reason WITHûAûCOUPONûOFûûTHATûWASûFARûLOWERûTHANûTHEûDOUBLE
TOûBEûTHEû5+SûFALTERINGûATTEMPTûTOûTRANSITIONûTOûAûPOST 1%û digit number it might have paid for straight bonds.
HIGH GROWTHûECONOMYûHASûBEENûAûDISASTERûWITHûTHEûSCOPEûFORû 7HENû#)&)û(OLDINGSûFOLLOWEDûINû!PRILûWITHûAû(+BNû#"û
further repercussions for global markets and wider lessons offering that went so well it tapped it for a further HK$588m a
for the rest of the developed world. few days later, it looked as though developers had found a way to
9ESûWITHûSOME ûTAXûCUTSûREVERSEDûAûCHANCELLORûGONEûANDûAû monetise the volatility of their stocks and rebuild market access.
prime minister potentially not far behind, the schadenfreude )TûWASûAûRISKYûBETûFORûINVESTORSû-ANYû#HINESEûPROPERTYû
of watching a further collapse of the UK’s credibility is no COMPANIESûHAVEûSMALLûFREE mOATSûWITHûTHEûMAJORITYûOFûSTOCKû
doubt fun for those who have to put up with snooty Brits, but held by the chairman’s family. Often, some of those shares
there is a bigger picture here. are pledged against undisclosed loans, meaning that in times
Two events are still scheduled to take place on October 31. of stress the stock price enters freefall.
/NEûISûTHEûNEW ûCHANCELLORûEXPLAININGûHISûNEW ûlSCALûPLANSû #ONVERSIONûPREMIUMSûINûTHEûHIGHûTEENSûLOOKEDûGENEROUSû
TOûPARLIAMENTû4HEûOTHERûISûTHEûSTARTûOFûTHEû"ANKûOFû%NGLANDû to investors a few months ago, but the most recent clutch of
selling its Gilt portfolio – active quantitative tightening. #HINAûPROPERTYû#"SûNOWûNEEDûSHAREûPRICESûTOûGAINûANYWHEREû
The latter was originally scheduled to begin in early FROMûnûTOûBEûINûTHEûMONEY
October but was delayed because of the fallout from the If the start of the year had been rock bottom for the
DISASTROUSûNOTûSOûMINI BUDGET #HINESEûPROPERTYûSECTORûTHENû#"SûWOULDûHAVEûMADEûSENSEû
7HETHERûTHEû"ANKûOFû%NGLANDûSTILLûGOESûAHEADûONû/CTOBERû and rewarded investors handsomely.
31 is the big unknown in the market. Indeed, many market )NSTEADûLIQUIDITYûCONTINUEDûTOûTIGHTENûANDû#)&)ûDEFAULTEDû
participants believe the Bank will have to perform another ONû-ONDAYûWHENûITûWASûTIMEûTOûPAYûTHEûlRSTû#"ûCOUPONûnûTHEû
humiliating climbdown given the turmoil in the Gilt debt part of the equation.
markets, which has continued despite the central bank Right now, it’s impossible to say what the right value is for
(reluctantly) conducting emergency interventions since ANYû#HINESEûPROPERTYûSTOCKûSIMPLYûBECAUSEûITSûIMPOSSIBLEûTOû
September 28. KNOWûWHICHûCOMPANIESûWILLûSTILLûEXISTûINûAûCOUPLEûOFûYEARS
The Bank’s governor, Andrew Bailey, insisted that those "ANKSûAREûWARYûOFûLENDINGûTOûTHEMûPROSPECTIVEûHOME
interventions would stop as scheduled on October 14, laying owners don’t want to buy a property that might never be
THEûGROUNDûFORû14ûTOûBEGINûTWOûWEEKSûLATERû"UTûSOûPOORûHASû completed, and equity offerings would need steep discounts
the communication been from the Bank that no one can be from already depressed valuations.
CERTAINûWHICHûWAYûITûWILLûTURNûNEXTûESPECIALLYûGIVENûTHEû 4HEûONLYûWAYûTOûGIVEûTHATûEQUITYûAûSOLIDûVALUEûISûFORûSTATE
OBVIOUSûPOLICYûVACUUMûASûTHEûPRIMEûMINISTERûlGHTSûFORûHERû linked companies to take stakes in private developers,
political life. sending a signal that they won’t be allowed to fail.
Incidentally, while the Bank’s comms have been pretty )TûLOOKSûUNLIKELYûTHATûSTATE OWNEDûCORPORATESûWILLûBEû
hopeless there’s a good case to be made that it was Bailey allowed to lead takeovers of property companies that have
sticking to his guns that meant that Truss was forced to make OVER BURDENEDûTHEMSELVESûWITHûEXPENSIVEûDEBTûBUTûTHEREûISû
HERûSTAGGERINGû5 TURNûANDûlREûHERûCHANCELLOR û"ANKûOFû one potential compromise.
%NGLANDûû5+ûGOVERNMENTû #HINASûSTATE OWNEDûASSETûMANAGEMENTûCOMPANIESûnûAKAûBADû
%ITHERûWAYûTHEû"ANKSû14ûPLANSûREMAINûTHEûMOSTû BANKSûnûALREADYûHAVEûAûHEFTYûEXPOSUREûTOûTHEûSOURINGûPROPERTYû
aggressive of all the world’s central banks that are engaged sector. Taking a sizeable stake in some developers, and perhaps
in tightening their monetary policy. The US Federal Reserve, MERGINGûAûFEWûTOûACHIEVEûCOSTûEFlCIENCIESûWOULDûFULlLûTHEIRû
FORûEXAMPLEûHASûBEENûJUSTûLETTINGû4REASURIESûANDûMORTGAGE mandate of supporting the economy and cleaning up bad debt.
backed securities roll off its balance sheet as they mature. It would also deliver an instant boost to the sagging
4HEû%#"ûISûEVENûLESSûHAWKISHû4HESEûMONETARYûAUTHORITIESû valuations of real estate debt and equity in their portfolios.
WILLûBEûNERVOUSLYûWATCHINGûWHATûSTEPSûTHEû"ANKûTAKESûNEXTû)Tû #HINESEûDEVELOPERSûFACINGûAûMATURITYûWALLûWOULDûBEû
ISNTûJUSTûTHEû5+SûTATTEREDûCREDIBILITYûTHATûISûATûSTAKE GRATEFULûTOûBADûBANKSûFORûPUTTINGûINûAûmOOR
International Financing Review October 15 2022 1

Top news
UK panic ensnares corporates 04 European ABS still standing 04 EU outshines Germany 06
Investors call for BoE U-turn on Gilt sales

People & Markets Doubt over plans for Bank of England to begin QT on schedule amid heightened volatility
BY HELENE DURAND, !ûlSCALû5 TURNûISûhHELPFULûTOû coming tax U-turn, pushing the active sales of Gilts. “We’ve seen
CHRISTOPHER WHITTALL the market and could also lessen 30-year yield down to as low as from the second quarter that the
pressure on the BoE to support 4.2% on Friday morning before it Gilt market was buckling under
A growing number of investors Gilts”, said Antoine Bouvet, rose back to 4.8% in choppy the prospect of QT. The end of
and economists are convinced senior rates strategist at ING. afternoon trading. the month is way too short, they
the Bank of England should “We aren’t out of the woods yet, need to postpone until at least
delay sales of its Gilts portfolio however, and now isn’t a time COMMUNICATION ISSUE 2023. They need to reduce
that are currently scheduled to for complacency. It will take $ESPITEûWHATûHADûBRIEmYû uncertainty and buy some time,”
begin at the end of the month time to restore trading appeared to be a more positive he added.
amid ongoing volatility in UK conditions in the Gilt market tone in the markets towards the
government bond markets. that look even remotely normal. end of the week, investors BALANCING ACT
Such a move would mark a The BoE has a chance to get the remained unimpressed by the There is no denying that the BoE
climb down for the BoE, which situation under control; let’s "O%SûPLANSûTOûlNISHû'ILTû HASûBEENûFORCEDûINTOûAûDIFlCULTû
has so far appeared determined hope they seize it.” purchases on October 14 only to balancing act in recent weeks,
to proceed with its plans to start Orla Garvey, senior start Gilt sales on October 31. caught between the need to
selling Gilts on October 31. The lXED INCOMEûPORTFOLIOûMANAGERû “The Bank of England has a shore up febrile UK bond
central bank has already had to at Federated Hermes, said “the communication issue. It makes markets (without looking like it
postpone the start of this “active MARKETûFOCUSûSHOULDûlRMLYûSHIFTû no sense to say you’ll buy bonds ISûlNANCINGûTHEûGOVERNMENTSû
quantitative tightening” from its from the BoE to the one week and sell them the lSCALûLARGESSE ûANDûREMAININGû
original start date of early government”. Still, she believes next,” said David Zahn, head of credible in its battle to tame
October, after it announced it’s “highly unlikely” that active %UROPEANûlXEDûINCOMEûATû INmATIONûTHATûHASûBEENûRUNNINGû
emergency Gilt purchases on QT will begin at the end of Franklin Templeton. at multi-decade highs.
September 28 in an effort to October “given the fragility of “They need to stabilise the The Gilt market had become
calm bond markets upended by the market and the upcoming market, remove the stress that’s dysfunctional following the UK
the UK’s so-called mini-budget. risk events” including a series of there, get it working again and government’s mini-budget on
That emergency purchase important central bank then talk about QT. They should September 23, which promised
programme was due to stop on meetings around the turn of the wait several months, maybe large, unfunded tax cuts along
Friday, but many analysts doubted month. until early next year. The market with a huge energy bailout for
that it would with bond markets is getting confused by [their consumers and businesses. Bond
remaining febrile. Analysts are CRAZY WEEK mixed messages]. As a result, we yields jerked higher in response,
even less convinced that the BoE It was certainly another topsy- are going to get more volatility. triggering unmanageable
will be able to start to sell Gilts at turvy week in Gilt markets amid “They need to get the Gilt margin calls for pension funds
the end of the month. They note AûmURRYûOFûNEWSûFROMûBOTHûTHEû market working properly given that had deployed “liability-
the market outlook remains BoE and the government. that the Gilt market is how they driven investment” strategies
hugely uncertain amid fast- Long-dated yields jumped transmit their monetary policy,” using derivatives.
moving political events. earlier in the week despite the he added. The announcement of the
Gilts had staged a rally in the BoE unveiling a series of new Bouvet said the BoE had made BoE’s emergency purchase
latter half of a roller-coaster measures aimed at alleviating a mistake in committing to programme on September 28
week following media reports market stress. The 30-year yield sent long-dated Gilt yields
that the government was set to rose above 5% on Wednesday – 30-YEAR GILT YIELDS ON FRIDAY tumbling lower, creating some
make an extraordinary U-turn perilously close to the level at % much-needed breathing room
4.70
OVERûITSûlSCALûPLANSû4HATû which the BoE originally for pension schemes to
culminated in prime minister announced its emergency 4.65 replenish liquidity reserves. The
Liz Truss sacking chancellor purchases – as many doubted 4.60 danger for the BoE was that a
Kwasi Kwarteng on Friday and markets could cope with the BoE more prolonged commitment to
4.55
scrapping a cut in corporation ending its emergency purchases underpin Gilt markets could
4.50
tax that the government had on Friday. lessen the pressure both on
pledged in the mini-budget. But Gilts rallied as the week 4.45 pension funds to delever – and
But the rally faded on Friday wore on, bringing much-needed 4.40 on the UK government to
afternoon, when the BoE breathing room for pension 4.35
reassess its proposed tax cuts.
completed the last of its funds, which have found Neil Shearing, group chief
4.30
scheduled Gilt purchases, raising themselves at the centre of the economist at Capital Economics,
4.25
questions over how stable market turmoil. A rebound that said markets needed reassuring.
markets would remain even began on Wednesday afternoon 4.20 “In every conceivable
07:30 09:30 11:30 13:30
after the government’s partial accelerated on Thursday 08:30 10:30 12:30 14:30 scenario, the BoE will have to
policy reversal. following the reports of the Source: Refinitiv backstop the market for a long
2 International Financing Review October 15 2022

@ For daily news stories
visit www.ifre.com
Pension funds mull loans 07 Kanzhun out of shadows 08 Working out underwriting emissions 10
time,” said Shearing. “It has a

torturous path ahead.”
Bankers fret over leveraged
Paul Dales, chief UK economist
at Capital Economics, said that
having already delayed the start of
finance maturity wall
active QT, it would make sense for Loans/Bonds Borrowers encouraged to refinance sooner rather than later as costs rise
the BoE to wait a little bit longer.
“As we shift to a higher rate BY ELEANOR DUNCAN probably be a spirited discussion Other borrowers are a little
environment, that creates more that we will have at some point.” closer to the wire. A TLB due
uncertainty so it will be harder for The lack of liquidity in the October 2024 backing BC Partners-
the BoE to shrink its balance sheet %UROPEANûLEVERAGEDûlNANCEû BITE THE BULLET owned Spanish bridal company
as quickly as it wants,” he said. market is becoming a major It may take borrowers some PRONOVIAS is seen in secondary at
problem for borrowers with prompting to pull the trigger on around 67% of face value.
STANDING TALL near-term maturities as they face THEIRûDEBTûRElNANCINGSûASûTHEYûAREû The primary market is not the
The BoE may yet win credit for an ever-rising cost of capital. facing almost unprecedented costs. only route to delever. Balkan
standing its ground. But many Europe’s leveraged companies Pricing in the leveraged telecoms conglomerate UNITED
believe muddled messaging out have a total of US$9bn-equivalent lNANCEûPRIMARYûMARKETûHASû GROUP, owned by BC Partners,
of Threadneedle Street has been in term loan Bs maturing in 2023 gapped even wider than it was announced on Wednesday that
damaging to the BoE’s and 2024, according to LPC data. in the summer, with average it would use proceeds from asset
credibility. BoE governor There is also some €65.2bn of yields in the high-yield bond sales to repay its 2024 and 2025
Andrew Bailey said on Tuesday euro-denominated high-yield market now almost 250bp wider high-yield bond maturities.
that the support would end this debt maturing in 2023, according at 9%. Swedish alarm company
week, while the Financial Times TOû2ElNITIVûDATA VERISURE – considered a strong CAUTIONARY TALE
reported the BoE had told “It’s not a huge number. In non-investment-grade credit – Israeli plastic furniture maker
bankers privately that the the course of a relatively normal recently priced a €500m senior KETER, owned by private equity
purchases could be extended. lNANCINGûYEARûYOUûWOULDNTûBEû SECUREDûRElNANCINGûBONDûATûAû company BC Partners, is a
Luke Bartholomew, senior talking about it at all,” said a 9.25% coupon. The notes being cautionary tale for borrowers that
economist at abrdn, said the LEVERAGEDûlNANCEûBANKERûh"UTûITû replaced carried a 3.5% coupon. may be considering waiting until
BoE was trying to dispel is still something that individual “Issuers are going to have to THEûLASTûMINUTEûTOûRElNANCEû4HEû
CONCERNSûAROUNDûlSCALû issuers are having to grapple come because the rates COMPANYûATTEMPTEDûTOûRElNANCEû
dominance, where it would be with, and the impact of that on environment isn’t going away,” said a €1.105bn senior secured term
forced into more permanent THEIRûCOSTûOFûlNANCINGû4HEû a second banker. “Rates are not loan B at the end of January but
operations to support Gilt yield. macro picture isn’t so bleak that going to be materially lower in a decided to shelve the deal after
“Having to reverse course there is going to be a liquidity- year’s time so borrowers might as investors demanded a larger
after such an explicit statement driven default wave, but the cost well bite the bullet now and do it.” premium than the sponsor was
of intent is likely to end up of capital is going to go up quite Credits with a more willing to pay. Since then, funding
further damaging the Bank’s materially on debt being checkered history, or with more conditions have worsened.
standing with markets and RElNANCEDv secular headwinds than Keter is now looking to repay
EFlCACYûOFûITSûCOMMUNICATIONvû Borrowers are expected to Verisure, may get a rougher ride a portion of its €1.205bn term
Bartholomew said. RElNANCEûSOONERûRATHERûTHANû in primary, said bankers. Those loan B and to push the maturity
later as the future is so uncertain credits may require capital of the remainder out by two
and because companies would injections in order to delever. years. If the company fails to
AVERAGE DAILY TRADING
VOLUMES IN GILTS rather be at the front of that “If you have a maturity complete the A&E, the credit is
£bn queue than the back, he said. coming up in 2024 you might likely to end up being
60 Bankers say they are now not be panicking, but if you’re a restructured, investors said.
spending more time on the cyclical business and you need Investors, meanwhile, are fairly
50 upcoming maturity clump than to extend, that’s going to prove sanguine about the maturity wall,
dealing with the pipeline of REALLYûDIFlCULTûUNLESSûYOUûCANû saying they will participate in
40 HUNGûACQUISITIONûlNANCINGSû show you’re deleveraging as RElNANCINGSûWHEREûTHEûBORROWERû
which has been whittled down well,” said a third banker. has a sensibly structured capital
30 to around €12bn. Some leveraged loan stack and is offering an
Lenders are already talking to borrowers with upcoming interesting coupon.
20 borrowers about pushing their maturities are already sending “The problem is that debt costs
maturities out, and say out distress signals. have risen,” said a high-yield and
10 RElNANCINGSûCOULDûHITûTHEûMARKETû French supermarket CASINO’s leveraged loan investor. “We
as soon as this year, depending on euro term loan B, which carries think that most companies can
0
market conditions. an August 2025 maturity, is seen tolerate that but if they have to
2/5/22
2/7/22
2/8/22
2/9/22
2/10/22
2/4/22
2/2/22
2/1/22
2/6/22
2/3/22
“We’ll see which ones want to bid in the secondary market at RElNANCEûWHENûTHEûMARKETûISûOFF
listen and which ones want to 79.8% of face value. The UK’s risk amid a weak economic
gamble on a better outcome by FLORA FOOD GROUP’s euro TLB, also environment, that doesn’t bode
Note: weekly data
Source: TRAX, MarketAxess waiting,” said the banker. “It will maturing in 2025, is at 78%. particularly well.”

Top news
UK panic ensnares corporate bonds
Bonds Top names see bonds caught up in mass selling, though bankers still hope for supply
BY ROBERT HOGG, SUDIP ROY so they don’t have a huge need “We feel at these levels and “We have had such a dearth of
for new debt in the near future.” with the liquidity that’s built up primary activity in sterling these
The forced selling by UK pension The sterling investment-grade there will be a meeting of last few months, I would expect
funds has sent a shudder not just corporate primary market has minds,” he said. “Things could a new deal, priced attractively
through the Gilt market but has been shut for over a month, with be worse in January and from a well-liked credit, would
also embroiled UK corporates. nothing printed since Danish February. Issuers may say ‘I hate actually do quite well,” said
Even the best credits have utility Orsted sold two sterling 7% but the direction of travel is James Vokins, global head of
seen their yields soar. In one notes as part of a dual-currency not in my favour’.” investment-grade credit at Aviva
example of how rampant selling triple-tranche trade in early Higher yields could tempt Investors.
has swept up liquid names, a September. Those notes are now cash-rich investors into activity. “It may even add some
£500m 1.5% July 2026 bond trading 10–15 points below stability to the market and
issued by consumer goods reoffer. demonstrate the depth of the
COMPANYû5NILEVERû!!! ûWASû WHICH WAY NEXT? demand. Having said that, there
AVERAGE YIELD ON IBOXX GBP
trading at 6% at one stage last WHO’S FIRST? NON-FINANCIALS SENIOR INDEX
would need to be a high level of
WEEKûACCORDINGûTOû2ElNITIVû Bankers still hope there will be spread compensation to tempt
%
before recovering to 5.64% by more supply in the coming 7.5 investors to part with their cash
Thursday – though that’s still weeks, though that would and this would likely push the
100bp higher than where it was require a company to get over 7.0 secondary curve wider.”
quoted before the UK’s mini- lRST MOVERûFEARSûh7EûHAVEûlVEû 6.5
Paola Binns, head of sterling
budget on September 23. deals in the pipeline and you credit at Royal London Asset
“If you get a margin call, then need one to go to open up that 6.0 Management, said market stability
YOUûSELLûWHATSûMOSTûLIQUIDûlRSTû supply, but nobody wants to be was needed before any further
5.5
which after Gilts is corporates,” THEûlRSTvûSAIDûONEû$#-ûBANKERû issuance could be contemplated,
said David Zhan, head of “Unless that one goes, there 5.0 despite the attractive yields for
%UROPEANûlXEDûINCOMEûATû might be zero deals this year.” investors. She said, though, with so
4.5
Franklin Templeton. “For Yet at the same time, he was much up in the air, such as the
companies that need to hopeful that a “constructive” 4.0 Bank of England’s strategy, “it
RElNANCEûTHATûWILLûBEûEXPENSIVEû sterling market “will offer access looks unlikely to happen in the
3.5
Having said that, a lot of if issuers are willing to be 01/08 15/08 29/08 12/09 26/09 10/10
short term”.
corporates have spent the last pragmatic about absolute 2022 The Bank of England’s efforts
decade extending out maturities, levels”. Source: Markit/Refinitiv to stabilise markets in recent
European ABS still standing

after unprecedented secondary deluge
Structured Finance Bid for securitised product still there after third week of intense selling
BY RICHARD METCALF latest tally from Bank of America, product made it a particularly it’s one of the few instruments
while an earlier report from JP attractive option to sell. still around par, while Gilts and
Since the UK government’s not so -ORGANûPUTûTHEûlGUREûFORû!"3ûONLYû other things are trading at a
mini-budget sent markets reeling at the equivalent of €2.4bn – 11.6 “Even though levels SIGNIlCANTûDISCOUNTvûSAIDûANû
in the last week of September, times the average weekly volumes haven’t been great, ABS syndicate banker.
the European ABS market has for the year up to that point. (Lists and clearly pricing has
absorbed as much as 11 times the of bonds for sale known as BWICs TIP OF THE ICEBERG
moved down sharply
usual weekly amount of paper are the main mechanism for The elevated pace of selling was
being put up for sale. But as selling securitised products in the
because of the selling SUSTAINEDûINTOûTHEûlRSTûWEEKûOFû
volumes remained elevated for a SECONDARYûMARKET pressure, sellers have October, though at a slightly
third week running, observers The selling was prompted by a been getting bids, and lower level, bringing year-to-
say the market has held up sharp spike in Gilt yields, which because they’ve had to date ABS BWIC volumes to
remarkably well. forced UK pension fund managers sell, they’ve been trading €11.7bn, well above the €7.86bn
The volume of bids wanted in TOûOFmOADûBONDSûTOûRAISEûCASHûTOû put on sale by the same time last
competition hitting the European meet margin calls. And while the
them. A lot of paper has year, according to JP Morgan’s
ABS and CLO markets reached sell-off has affected the full gamut actually traded” lGURES
€5.3bn-equivalent in the week OFûlXEDûINCOMEû!"3ûMARKETû And that, say market
immediately following the tax cut participants say the short-dated, “It’s a natural go-to product to participants, may have been just
announcement, according to the mOATING RATEûNATUREûOFûTHEIRû sell in a volatile market, because the tip of the iceberg, with

For daily news stories
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days have included a temporary some immediate liquidity. For sterling. There have only been three-month Euribor by 120bp
pause on sales of its corporate example, ANGLIAN WATER, which four high-yield deals executed since August 1, the ratings
bond portfolio, which had has been sitting on a nine-year in the currency since the start of agency said Morrisons’ interest
started last month. It has also sterling sustainability-linked the year, three of them in expense would increase to
put in place a repo facility bond since holding calls on January. about £335m a year from
aimed at allowing pension September 6, is also exploring a Still, high-yield investors are around £300m, excluding lease
funds to borrow money £150m 15-year private relatively sanguine. “From a interest.
against assets including Gilts placement. public market or bond
and corporate bonds, though perspective, I’m less concerned “A lot of UK names
the effect on the corporate PLAYING AWAY because the big issuers are all have hedged and mix
market has been limited The picture is less clear for pretty much okay from a
fixed and floating-rate
because of the cost involved corporates lower down the liquidity perspective and don’t
to access it. ratings spectrum. Two UK- really have any maturities
debt. Unless they have
RELATEDûISSUERSûENERGYûlRMû coming due in the next two a near-term maturity,
“From a public market ENQUEST and entertainment years,” said one high-yield I don’t see a rising rate
or bond perspective,
company ODEON CINEMAS via investor. environment pushing
ODEON FINCO, did announce deals UK-domiciled high-yield
I’m less concerned them into defaults”
last week but in the US dollar corporates have £2.4bn-
because the big issuers market – a natural home for EQUIVALENTûOFûlXED RATEûDEBTû
are all pretty much both, given their particular maturing before the end of the
okay from a liquidity characteristics. year, according to IFR data, with
UK-domiciled EnQuest, which roughly £15bn-equivalent But even with interest rates
perspective and SOLDûAû53MûlVE YEARûNON maturing in 2023 and £12bn- ramping up, and a deep
don’t really have any call two note at 12%, is an oil equivalent in 2024. recession in the UK a possibility,
maturities coming due and gas company with a highly More concerning could be a second high-yield investor
in the next two years” international business, while ISSUERSûWITHûLARGEûmOATING RATEû thought most issuers will
UK brand Odeon Cinemas is a debt exposure like Morrisons, muddle through. “A lot of UK
In the meantime, certain UK SUBSIDIARYûOFû53ûOUTlTû!-#û given servicing costs will names have hedged and mix
corporates are considering Entertainment. Odeon’s become more expensive as lXEDûANDûmOATING RATEûDEBTvûHEû
other funding avenues, 53MûlVE YEARûNON CALLûTWOû interest rates rise. said. “Unless they have a near-
including other currency note was due to price on Friday Over half of the term maturity, I don’t see a
markets or private placements. SEEû4OPû.EWSûFORûMORE supermarket’s funded debt is rising rate environment
Private markets, in particular, For most UK high-yield mOATING RATEûANDûITûHASûNOû pushing them into defaults.”
HAVEûOFFEREDûDIVERSIlCATIONûANDû issuers, however, market access interest hedging in place, Additional reporting by Eleanor
a less volatile arena for APPEARSûAûMOREûDIFlCULTû according to Moody’s. With the Duncan, Helene Durand, Jihye
corporates seeking to lock down prospect, particularly in Sonia rate up by 100bp and Hwang and Lorena Ruibal
frantic bilateral trading also and because they’ve had to funds, sensing an opportunity in Australian investors,” he said.
taking place. sell, they’ve been trading them. the forced selling of high quality “European prime resi is
“There are very, very big A lot of paper has actually paper, have also stepped in. going back to European
trades going on behind the traded.” investors and treasuries.
scenes,” said an ABS portfolio “A lot of the Australian UK RMBS prime STS is
manager. “Banks have talked RANGE OF APPETITES paper getting sold is getting recycled back to UK
about the volumes they did [in The relatively orderly sell-off being recycled back treasuries who have been
the last week of September] and may have been helped by the stepping in and picking this
onshore to domestic
they don’t tally with the BWICs fact that, as the days have worn up in size.”
that we saw.” on, the types of bonds hitting
Australian investors. For issuers, this resilience in
Given the sheer amount of the market have varied, European prime the face of prolonged, heavy
bonds for sale and the extended appealing to investors with a resi is going back to selling has even allowed the
duration of the sell-off, traders range of risk appetites, European investors primary ABS market to remain
and investors are surprised at according to another syndicate and treasuries. UK open – for some.
how well the market has coped. banker. Irish specialist mortgage
Of the bonds put up for sale “The initial part of the
RMBS prime STS is lender FINANCE IRELAND priced an
through BWICs in the last week SELLINGûWASûEASIER TO mIPûRISKvû getting recycled back RMBS on Wednesday and
of September, 82% were traded, he said, giving senior UK prime to UK treasuries” VOLKSWAGEN LEASING was expected
according to JP Morgan. RMBS as an example. “Now to price a German auto ABS on
“To me, it’s actually amazing we’re seeing a bit more mezz, a A third portfolio manager noted Friday. But it was far from plain
that the market’s absorbed it,” bit of non-bank paper coming that, as the bonds have changed sailing. In a sign that conditions
said another buyside source. out as well, so there are still bids hands, they have often ended up were treacherous even for
“Even though levels haven’t for that.” with investors whose domicile non-UK issuers, CA CONSUMER
been great, and clearly pricing The market has been matches the country of risk. FINANCE pulled a French auto ABS
has moved down sharply supported, as it has been “A lot of the Australian paper offering from the market on
because of the selling pressure, throughout the year, by bank getting sold is being recycled Monday, citing extreme
[sellers] have been getting bids, treasuries. But credit and hedge back onshore to domestic volatility.

Top news
EU outshines Germany in long-end euros
Bonds Attractive yield helps the European Union come out on top
BY LUKE ACTON developed market sovereign in wasn’t really a good idea to by appearing on the same day as
2022 after Luxembourg and compete. On the EU 20-year, it’s another major issuer. In an
A head-to-head contest between Greece, IFR data show. almost a 3.5% yield – or 3.4%. On emailed answer to IFR’s questions,
the EUROPEAN UNION and GERMANY “It really seems it has been the Bund, it’s 2.3% or something an EC spokesperson said: “The
at the long-end of the euro quite a bad idea to go head-to- like that for 10 years longer … If European capital market is strong
market saw the supranational head with the EU,” said a banker you have that on the same day – enough to absorb the supply of
win the upper hand on Tuesday, away from the deal. the numbers are right in front of two highly rated and liquid issuers
helped by pricing dynamics that “It’s understandable from you – then an investor might on different parts of the yield
played in its favour. their point of view that they decide, well I’d rather go for the curve. Therefore we decided to
Large public sector issuers don’t want to back away because EU.” continue showing reliability to
typically try to steer clear of it’s Germany [the safest SSA in The EU offered 3.026% yield our investor base and to execute
each other when bringing deals the euro market]. But, on its short tranche and 3.404% our transaction as expected by
in primary, but it appeared that nevertheless, in the end it just on the longer line. In relative markets.”
neither the EU nor Germany terms, it paid 88.3bp more than For Germany, the €5.9bn book
were prepared to back down and Bunds with the December 2029 was far smaller than the €21bn
OFFERING A YIELD PICK-UP
stuck to their expected issuance % tap and 101.9bp more with the book it gathered in March, when
calendar. 3.5 20-year. it last came with a €4bn 30-year
7ITHûlNALûBOOKSûCOMINGûINûATû 3.3 That meant that the EU’s leads offering, a tap of its 0% August
over €26bn (including €1.85bn Barclays, Bank of America, Deutsche 2052 line. Given the relatively
3.1
OFûJOINTûLEADûMANAGERûDEMAND û Bank, JP Morgan and NatWest were modest interest, the sovereign
2.9
for the EU’s €6bn 20-year able to tighten pricing on the STAYEDûmATûTOûGUIDANCEûOFûTHEû
tranche, versus €5.9bn 2.7 short line by 1bp to mid-swaps 2.5bp area above Bunds. Barclays,
(including €850m from the lead 2.5 minus 21bp and the longer BNP Paribas, Deutsche Bank, Goldman
MANAGERS ûFORû'ERMANYSûõBNû 2.3
paper by 2bp to mid-swaps plus Sachs, and JP Morgan were leads.
August 2053 trade, the EU was a 32bp, both offering around 2bp The deal was seen offering 1bp to
2.1
clear winner when it came to of concession, according to the 2bp of new issue concession.
investor demand. The EU’s 20- 1.9 lRSTûBANKERû!ûSECONDûBANKERû Nothing about the Bund’s
year was launched alongside a 1.7 put the premium at 2.5bp for pricing looked incorrect,
€5bn December 2029 tap that 1.5 both the bonds. HOWEVERûTHEûlRSTûBANKERûSAID
1Y
2Y
3Y
4Y
5Y
6Y
7Y
8Y
9Y
10Y
15Y
20Y
25Y
30Y
SAWûlNALûBOOKSûPASSûõBNû&ORû The European Commission, “We had almost the same

Germany, it meant it got the Germany EU which arranges the EU’s pricing in mind ourselves. I’m
third-smallest book of any Source: Refinitiv Eikon borrowing, said it was not fazed not convinced an additional 1bp
UK high-yield issuers seek refuge in dollars

Bonds US proves haven for junk-rated firms as turmoil rocks Gilt market
BY MICHAEL HALEY, LORENA RUIBAL call two senior unsecured In a report ahead of pricing, Scotland-based Harbour Energy’s
lXED RATEûNOTEûONû/CTOBERûû S&P said “supportive oil market 53MûûlVE YEARûNON
Rattled UK junk-rated companies The issue came at a yield of 12%, conditions will result in lower call two senior secured sold in
looked to the US last week for the tight end of price talk that leverage and strong operating October last year at par has
RElNANCINGSûASûTURMOILûROCKEDû went out to 12.25%. One CASHmOWvûFORû%N1UESTû)Nû “massively underperformed US
the Gilt market. comparable was US dollar notes addition, it noted the names”, he said.
The UK has seen severe due 2026 from Energean Israel. RElNANCINGûWOULDûSUBSTANTIALLYû
market ructions over the past The Ba3/BB– notes from improve the company’s liquidity BIG PICTURE
few weeks caused by the Energean’s opco were quoted at position. London-headquartered Odeon
government’s unfunded growth 8.39% on Wednesday, according A European high-yield Cinemas, meanwhile, was due to
plans. The US junk market, in TOû2ElNITIVû!û53 BASEDûINVESTORû investor agreed that E&P oil and PRICEûAû53MûlVE YEARûNON
contrast, has been relatively said any difference in yield gas companies are in “probably call two senior secured note on
placid, with mostly buyout deals WOULDûREmECTûAû5+ûPREMIUMûFORû one of the few sectors that, at Friday. The fundraising would
peppering its landscape. And it EnQuest. least fundamentally, is quite help repay its term loans.
proved to be a haven for ENQUEST, BNP Paribas, Bank of America, good right now”, though Citigroup is lead-left on the deal
a UK-domiciled oil and gas DNB Markets and Goldman Sachs stressed that alone would not be while Barclays is a joint
company, and ODEON CINEMAS, a were active bookrunners on the enough to drive demand. bookrunner.
5+ûSUBSIDIARYûOFû53ûOUTlTû!-#û B3/B+ rated deal. Proceeds from He said there was a lot of “They have the advantage
Entertainment. EnQuest’s bond, along with its reticence from European high- there’s a US parent company
EnQuest, which last issued a reserve-based lending facility yield accounts to buy energy behind [them] and the US
US high-yield bond in 2014, and cash, will be used to names due to the ESG angle. market would know it,” said the
PRICEDûAû53MûlVE YEARûNON RElNANCEûITSûûSENIORûNOTES Also, performance is not a given. European high-yield investor

visit www.ifre.com
or 2bp of premium would have

really turned it around. It’s
demand was down to price.
“Ours was the most expensive Pension funds consider
rather a fundamental problem bond – ie, the most favourable
in terms of timing.” for taxpayers – in the market, a
market that is currently facing
loans to bridge crisis
TOO EXPENSIVE high volatility,” she said. People & Markets Short-term loans to help avoid fire sales
But a third banker said it was in “We selected the clearest
fact pricing, not timing, that issuance window for us. From BY CHRISTOPHER SPINK ACCEPTûNON lNANCIALûCORPORATEû
was the reason for Germany’s our point of view the issuance of bonds issued in the UK, US and
smaller books. The second the EU had no relevant impact UK pension funds are in EEA.
banker and a fourth also said on the outcome of the syndicate discussions about taking out One market source said the
the investor bases were separate as the EU issued [in] other short-term loans to meet bridge loans were being
enough for them not to maturities.” collateral requirements sparked arranged very quickly and
interfere with each other. !DDINGûTOûTHEûDIFlCULTIESû by the collapse in the price of generally being done at
“It looks like the market view Germany faced, reports of Gilts. Such bridge facilities will standard market rates. “No
is that it looks a bit rich,” the chancellor Olaf Scholz putting allow affected funds more time one is gouging anyone here,”
third banker said, calling the more support behind a joint EU to rebalance their portfolios he said. “It is a question of this
sovereign’s book “rather issuance programme could have until the market is calmer and being a more cost-effective route
skinny”. dented the sovereign’s deal, the SOûAVOIDûFURTHERûlREûSALES to take until markets quieten
“I think there’s a bit of a fourth banker said, as it may Concerns mounted last week down.”
buyer strike. It’s part of the have affected how buyers look that the volatility in the Gilts Charles Counsell, chief
challenge of being the richest at the sovereign’s debt. market would resurface if and executive of The Pension
issuer in the market … I think “Germany is viewed to be the when the Bank of England stops Regulator, said in a letter to the
they’ll have to take some strongest jurisdiction in Europe. its temporary measures to buy Work and Pensions Select
lessons from their experiences If, to a greater extent, Germany Gilts. It had stepped in after Committee: “We continue to
and have a bit of a think about mutualises its debt with the pension funds were forced to work with the Bank, other
their approach.” other sovereigns, then that sell holdings to post cash as regulators, and pensions
He added that, while there special status of Germany collateral to keep derivatives schemes to put in place
should be market capacity to get would, over time at least, be linked to their liabilities in mitigations for events that
both deals through the market reduced in the long end place. might happen after 14 October.”
at the same time, they were big potentially.” As it stands, the BoE’s scheme Redmayne, who advises
events and that his advice would He said that, combined with was due to end on October 14 pension scheme trustees and
be not to go up against the EU volatility on the day, slowed and after a decision by prime sponsors on risk management,
given it is a magnet for buyer participation in the deal. minister Liz Truss to reinstate said all energy was at present
investors. “It was quite impressive that planned increases to corporation focused on liquidity and
A spokesperson at the Germany managed to reach the tax, the government is now not collateral arrangements. “A lot
sovereign said the smaller result that they reached.” due to set out further details of depends on the [pension]
ITSûlSCALûPLANSûUNTILû/CTOBERû scheme and whether and to
“Schemes are considering what extent they are in LDI,
said. Without that, it “becomes facilities due in 2023 as well as putting in place facilities segregated or pooled,” he said.
AûMUCHûMOREûDIFlCULTûSTORYv fees and expenses. bridging them to the end of the He said LDI strategies would
Initial price thoughts on the It’s not just UK-related month. If these liquidity remain a key tool for pension
deal, issued via ODEON FINCO, were companies issuing in the US facilities are put in place then funds despite the strains of the
coming with a 12.75% coupon at dollar high-yield market. they perhaps can step past last few weeks.
a price of 95–96, said a banker Chilean-based LATAM AIRLINES selling into unprecedented “No one is saying we should
working on the deal. The priced a downsized US$1.15bn volatility,” said Darren not do retail banking because of
coupon with OID imply a yield bond last week to repay its Redmayne, chief executive of the 2008 crisis. Pension schemes
of about 14%, according to debtor-in-possession loans as it pension adviser Cardano have put in place LDI strategies
CreditSights. emerges from bankruptcy. And Advisory. and used them for decades and
With rival cinema chain earlier in October, Canadian “This will be short-term they have worked generally
#INEWORLDûlLINGûFORûBANKRUPTCYû natural gas equipment supplier borrowing for weeks and well,” he said. However,
and another competitor, Vue ENERFLEX priced an months to manage liquidity schemes would review what had
International, recently acquired oversubscribed US$625m senior given the recent statement from happened and maybe seek legal
by lenders as part of a note to fund a portion of an the Bank of England. These redress.
restructuring, the sector is acquisition. facilities are coming from “When the dust has settled we
under some stress. However, Non-US domiciled issuers sponsors, the relationship banks will see big winners and big
CreditSights analysts believe have priced 28 high-yield bonds to the schemes, and some of the losers from what has happened
that on Odeon “investors are in the US market this year, investment banks.” and the losers I’m sure will be
more than compensated by according to IFR data. On Wednesday BARCLAYS said it looking to see what recourse
healthy asset coverage”. “Foreign issuers come to the would “provide access to and actions they can take in due
Along with US$151.8m in US market for better liquidity additional liquidity for liability- course,” said Redmayne. “I
cash on its balance sheet, Odeon and currency-adjusted yields,” driven investment funds against expect future scrutiny of
will use proceeds from the bond said Michael Donelan, a senior eligible collateral”. The bank governance around decisions
to fund US$505.6m in high-yield portfolio manager at said this would be available until taken quickly and whether the
repayments of its term loan SLC Management. November 10 and that it would sponsor was involved.”

Top news
Kanzhun emerges from CAC’s shadow
Equities Lifting of cybersecurity concerns clears the way for two Hong Kong listings
BY FIONA LAU TRUCK ALLIANCE, had illegally raise funds. We expect FTA to capitalisation of US$6.77bn. The
collected users’ personal data. It push ahead with its Hong Kong stock is down 55% this year.
Nasdaq-listed Chinese job listing ordered their apps to be removed listing soon given Kanzhun now
portal KANZHUNûLASTûWEEKûlLEDûFORû from app stores in China. seems to have obtained blessings LONG ROAD
a Hong Kong listing, signalling After a year of investigation, from regulators to do so,” said In contrast, Didi’s road to a Hong
that some Chinese technology the regulator allowed Kanzhun one of the bankers. Kong listing may take longer even
companies that were previously and FTA to resume new user &4!ûAIMSûTOûlLEûASûEARLYûASûLATEû THOUGHûITûHASûALREADYûBEENûlNED
under a regulatory cloud are registrations at the end of June October for a dual primary lising “Didi is much bigger and the
now in the clear to list in the as both companies were deemed in Hong Kong, according to regulatory issues it involves are
city. TOûHAVEûRECTIlEDûTHEûBREACHESû)Nû people familiar with the much more complicated. The
Tencent-backed Kanzhun, *ULYûTHEûREGULATORûlNEDû$IDIû situation. Morgan Stanley, Goldman company is keen to restart its
which operates the Boss Zhipin 2MBBNû53BN ûFORû Sachs, UBS and Huatai International Hong Kong listing process but it
app, was one of three US-listed violating data security laws. are working on the transaction. will take some time before they
companies targeted by China’s With Kanzhun moving ahead Goldman Sachs and Morgan can go public again,” said
cyberspace regulator when it to list in Hong Kong, bankers Stanley are the sponsors for another banker.
started cracking down on the believe FTA will follow suit soon, Kanzhun’s dual primary listing CCB International, CMB
COUNTRYSûGIANTûTECHNOLOGYûlRMSû while Didi may revisit the Hong in Hong Kong, which is expected International and Goldman Sachs
in July last year. Kong listing option after to raise several hundred million are working on Didi’s potential
The Cyberspace delisting in the US in June. US dollars, subject to share price Hong Kong listing.
Administration of China said at h+ANZHUNSûlLINGûISûAûPOSITIVEû performance.
the time the company, together sign as it means the Shares in Kanzhun closed at NO CONFIDENCE
with ride hailing giant DIDI GLOBAL cybersecurity probe is largely US$15.57 on Nasdaq on Kanzhun is joining an increasing
and truck service provider FULL behind it and it can move on to Thursday for a market number of US-listed Chinese
Brookfield and Cameco go nuclear

with US$7.9bn takeover deal
Equities/Loans Purchase of Westinghouse shows confidence in zero-emission fuel contender
BY ANTHONY HUGHES, RHYS ADAMS 20 nations have announced in Eastern Europe from reactors "ROOKlELDû2ENEWABLEûANDûITSû
plans to expand their previously served by Russia’s institutional partners will own
Backers of nuclear power as one nuclear investments. Rosatom. 51% of Westinghouse, including
potential answer to the world’s "ROOKlELDûANDû#AMECOûALSOû The headline price includes a US$750m investment by
ENERGYûCHALLENGESûmEXEDûTHEIRû see opportunities for US$3.4bn of assumed debt that "ROOKlELDûFORûAûûSTAKE
lNANCIALûMUSCLEûWITHûTHEû Westinghouse to snare business will remain in place. Cameco, which will own the
purchase of equipment and other 49%, moved quickly to
services provider Westinghouse NUCLEAR RENAISSANCE
lNANCEûITSû53BNûSHAREûOFûTHEû
Electric for an enterprise value SPOT PRICES FOR URANIUM equity, raising US$650m from a
of US$7.9bn. US$/lb deeply discounted stock sale and
60
BROOKFIELD RENEWABLE PARTNERS securing commitments for
and Canadian uranium miner US$1.6bn of loans.
CAMECO joined forces on Tuesday
with an offer to buy the 50 CONCERNS
company that provides services Yet the acquisition drew mixed
to half the world’s nuclear reviews.
reactors. Some analysts raised concerns
“This is arguably the most 40 about the high price of 11 times’
SIGNIlCANTûTRANSACTIONû Westinghouse’s trailing Ebitda,
announced in the nuclear THEûSIGNIlCANTûOUTLAYûREQUIREDû
industry in over a decade,” 30
by Cameco, and the latter’s
Canaccord Genuity analysts surprising shift away from a
wrote in a note to clients. pure-play exposure to the rising
Though the 2011 Fukushima spot uranium price.
disaster markedly slowed the 20 Still, a banker said the stock
Oct 18
Oct 19
Oct 21
Oct 22
Jan 18
Apr 18
Jul 18
Jan 19
Apr 19
Jul 19
Oct 20
Jan 21
Apr 21
Jul 21
Jan 22
Apr 22
Jul 22
Jan 20
Apr 20
Jul 20
growth of nuclear power offering was well subscribed,

generation globally, at least Source: UxC, TradeTech with allocations split between

visit www.ifre.com
companies that have sought

home listings in Hong Kong in
continue in all aspects including
lNANCIALûMARKETSûANDûTHEû Auto ABS issuers
the past few years in response to auditing issue is unlikely to be
the possibility that US accounting
rules could force them to delist.
resolved anytime soon. Listing in
Hong Kong is still a preferred
face bumpier road
The US Public Company back-up plan,” said a third banker. Structured Finance Investors in the driving seat
Accounting Oversight Board, Kanzhun, in which Tencent
the China Securities Regulatory owns a 9.9% stake, plans to use BY RICHARD LEONG Auto issuers that moved to the
Commission and China’s the proceeds to grow its user sidelines hoping for calmer
Ministry of Finance in August base and user engagement, US auto ABS issuers are markets are relying more on
signed a statement of protocol expand services, enhance core navigating trickier terrain as BANKSûFORûlNANCINGûh3OMEû
agreement that could end the technology capabilities and as traditional support for the issuers are pivoting in the near
dispute exposing Chinese working capital. paper’s supply – high vehicle term and they are leaning on
companies to forced delistings The company said that since prices and low delinquencies – their bank and warehouse lines
from US stock exchanges. it resumed user registration it are in question after several more,” said Alexander
However, market participants has recorded more than 10 aggressive US Federal Reserve Slobodian, head of consumer
will remain cautious over the million newly registered users rate increases and expectations and commercial asset
preliminary audit deal reached from June 29 to August 15. Its the federal government would origination at Societe Generale.
by the two countries until they monthly active users and not provide another round of Despite a still tight US labour
have had a chance to assess how average daily active users in July stimulus to consumers if the market, the Fed’s attempts to
THEûlRSTûBATCHûOFûINSPECTIONSû hit record highs, with MAUs in jobs market softens. BEARûDOWNûONûINmATIONûHAVEû
goes. July increasing by 16% Those trends have made it already affected auto loan
The inspections have begun compared with June. MOREûDIFlCULTûTOûISSUEûNEWûDEALSû delinquencies.
but it could take months before &ORûTHEûlRSTûHALFûOFûû and put investors in the driver’s Serious delinquencies among
the conclusions are known. +ANZHUNûPOSTEDûAûNETûPROlTûOFû seat, market participants said. subprime borrowers increased
“Most Chinese issuers still 2MBMû53M ûCOMPAREDû Auto ABS supply, which has to 5.16% in September, which
believe the political dispute with a loss of Rmb1.59bn a year accounted for about half of all was 173bp higher than a year
between China and the US will earlier. asset-backed supply since the ago, according to Barclays.
coronavirus pandemic, has slowed Serious late payments among
in recent weeks. Issuance so far prime borrowers ticked up to
institutional investors in the US The miner expects its this year has totalled US$91.98bn, 0.40%, which was only up 12bp
û#ANADAû ûANDûTHEûRESTû “participation in the nuclear down from the US$104.08bn from a year earlier.
OFûTHEûWORLDû fuel value chain” to be during the same period in 2021, The other tailwind – lofty used
"ROOKlELDûISûSHIFTINGû immediately accretive to ACCORDINGûTOû2ElNITIVûDATAû!UTOû car prices – that has supported
Westinghouse between two of CASHmOW issuers rolled out US$129.33bn in auto ABS is waning. The widely
its listed vehicles, allowing the “More than ever, the world is securitised paper for all of 2021. followed Manheim US used
SELLERû"ROOKlELDû"USINESSû looking for a stable, reliable, At least two issuers have vehicle index declined to 204.5
Partners, to book an estimated and politically dependable fuel postponed their offerings in last month from a record high of
six-fold return on invested supply,” Cameco CEO Timothy recent weeks. 236.3 recorded in January.
capital after buying Gitzel said on a conference call In late September, used car Used vehicle values are still
Westinghouse out of on Tuesday. “I believe we’re retailer DRIVETIME AUTOMOTIVE expected to remain higher than
bankruptcy just four years ago. witnessing a fundamental delayed its US$325.82m subprime their historic average as ongoing
4HEûDEALûENABLESû"ROOKlELDû change that will alter the way securitisation. A week later, auto supply chain issues limit new
Business Partners to shed an countries approach their energy lender SOUTHERN AUTO FINANCE CARûOUTPUTûPUTTINGûAûmOORûUNDERû
asset that has contributed to it needs... Anyone who looks POSTPONEDûITSûlRSTû!"3ûOUTINGûAû used car values. This allows
trading at a discount to book. seriously at the global issues US$118.81m subprime deal. lenders to repossess cars and
"ROOKlELDû2ENEWABLESû we’re facing would say that Issuers that have gone ahead recoup the principal on auto
independent directors approved there’s no solution without with deals had to pay wider ABS paper, market players said.
the deal after soliciting a nuclear.” spreads. Slow new car output is likely
fairness opinion from Greenhill. Cameco’s senior unsecured “It’s a buyer’s market. You can to continue into next year,
“While there may be some loans comprise a US$1bn 364- name your spreads within reason,” keeping used car prices up and
CONCERNûWITHûANOTHERû"ROOKlELD day bridge loan, a US$300m said Invesco senior portfolio supporting auto ABS, Slobodian
AFlLIATEDûENTITYûBEINGûPARTûOFûTHEû two-year term loan and a manager Philip Armstrong. said.
buyers’ consortium, we believe US$300m three-year term loan. Last week, EXETER FINANCE, So while wider spreads are
the deal looks fair, given that the CIBC and Goldman Sachs also which is owned by private tempting for some fund
valuation is in line with our provided the loan commitment EQUITYûlRMû7ARBURGû0INCUSû managers, investors are
expectations,” Scotiabank letters. priced a US$569.72m subprime becoming more selective in
analysts wrote. The bridge loan is expected to auto offering. The offered what they buy.
Goldman Sachs and CIBC be reduced to US$375m using US$121.15m Class A-2 tranche “Now we are a bit cautious on
advised Cameco on the stock proceeds from the stock with a weighted-average life of certain used car issuers, but
offering and led the sale of offering. 0.50 years, fetched a spread of overall the sector offers some
29.6m shares at US$21.95 each. The acquisition is expected 120bp over Treasuries – wider real attractive opportunities,”
On Wednesday Cameco’s NYSE- to close in the second half of than the 105bp on a similar said Nick Tripodes, senior
listed shares closed above offer 2023. tranche in Exeter’s previous deal portfolio manager in structured
at US$22.30. Cameco is rated BBB– by S&P. in August. credit at Federated Hermes.

Top news
Banks work out how to work out

emissions from underwriting
People & Markets Banks debate the complex work of calculating emissions facilitated by investment banking
BY TESSA WALSH we need a more complete includes co-chairs Barclays and sell to as they are using different
picture. The work that is going Morgan Stanley and members methodologies,” Bowley said.
The Partnership for Carbon ONûISûCOMPLEXûANDûDIFlCULTûnû Bank of America, BNP Paribas, Another option is to use a 17%
Accounting Financials is close to emissions data requires a Citigroup, Deutsche Bank, weighting to determine an
lNALISINGûAûSYSTEMûTHATûWILLûHELPû lot of modelling,” said HSBC, NatWest and Standard underwriter’s share of a deal’s
banks calculate “facilitated Andrew Bowley, wholesale Chartered. emissions relative to those of
emissions” that include GOVERNANCEûOFlCERûATû.OMURAû The proposed methodology investors, a number derived
underwriting and other capital in London. suggests splitting responsibility from the weighting that the
market activities, as well as Banks have so far focused on for emissions between Basel Committee ascribes to
EMISSIONSûTHATûTHEYûlNANCEû lNANCEDûEMISSIONSûWHICHûISû arrangers by using league tables underwriting activities as a
directly. lNANCINGûTHATûTHEYûHAVEû from third-party data providers proportion of banks’ total
The ability to calculate provided directly to issuers and that assign credit to arrangers lNANCINGûACTIVITY
facilitated emissions will allow hold on their balance sheets depending on their roles, “That produces a weighting
banks to calculate more SUCHûASûLOANS û4HISûISûMOSTû although this does not capture that we felt was viable and
accurate Scope 3 emission suited to commercial banking every tier of banks involved in defensible for underwriting
footprints and produce more and has allowed banks to set deals, such as co-managers. activity of about 17%,” said Clark
transparent and detailed plans emissions-reduction targets on Some banks are querying why Anderson, head of climate
on how they aim to reach net- high-emitting energy portfolios. PCAF is not using the model change risk management at
zero emissions by 2050. Calculating facilitated that the Principles for Morgan Stanley.
PCAF, an initiative created in emissions has proved harder as Responsible Banking have Some bankers are concerned
ûBYû$UTCHûlNANCIALû these are off-balance-sheet DElNEDûWHICHûDIVIDESûTHEû that using a 17% weighting
institutions to improve services that are more typically amount raised by the number of could make banks look greener
TRANSPARENCYûINûlNANCIALû provided by investment banks lead managers. than they are, and that adding
services, is emerging as the ANDûINCLUDEûmOWûACTIVITIESûANDû Another ticklish subject is facilitated emissions into the
standard in carbon accounting what PCAF calls “temporary how responsibility for emissions mix could potentially increase
and emissions calculation for associations” with transactions is divided between the sellside EMISSIONSûANDûCONmICTûWITHû
THEûlNANCEûINDUSTRY rather than assets held on and buyside. Banks taking 100% banks’ previously announced
(OWEVERûSIGNIlCANTû books. PCAF believes that this of a transaction is the simplest targets.
questions remain about how to type of business deserves special option and avoids the potential Timing is also a consideration.
calculate facilitated emissions – treatment. criticism that they are not PCAF recommends that
particularly underwriting – and “PCAF views facilitation as a taking full responsibility for facilitated emissions are
PCAF is asking for feedback on SEPARATEûANDûSIGNIlCANTûMETRICû their actions. It is already being CALCULATEDûASûTHEûmOWûOVERûAû
its proposed methodology, and one that exerts material used by some market year and aggregated to give the
which it is aiming to publish in impact on the direction of participants. But it would lead total activity that banks
mid-November. capital towards economic to volatility as capital market underwrite, but this is
Questions include how to activities that will enable the activity went through booms complicated by a potential
allocate responsibility for transition to net-zero no later and busts and to double- timing mismatch.
facilitated emissions between than 2050,” it said in a report counting of emissions, as both “A key challenge for banks is
arranging banks, the amount of seeking feedback. arrangers and investors would that emissions for loan books
each deal that arrangers and report 100% of a transaction’s AREûBASEDûAROUNDûTHEûlNANCIALû
investors will take responsibility OUTSTANDING QUESTIONS emissions. year-end and their position at
for, as well as the time periods PCAF formed a working group “Banks are calculating their this date whereas if you’re
concerned. on capital market activities in lNANCEDûEMISSIONSûBUTûWEûAREû looking at underwriting it’s
“Most banks are adopting March 2021 to address currently unable to reconcile SENSIBLEûTOûLOOKûATûTHEûlSCALû
PCAF’s accounting system, but facilitated emissions. The group these with the investors that we year,” Bowley said.
Reach the people who matter

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People
12
&
Cowen’s top
six executives
Markets
15 Lazard hires
for a new 17 Japan’s
attempts to
will share US$223m geopolitical advisory transition to more
from “golden group to advise on green finance have hit
parachutes” and global risks and a speed bump in more
retention awards opportunities difficult markets
under TD’s takeover
FRONT STORY RESULTS
JP Morgan leads rivals with resilient FICC

Q3 advisory and underwriting fees slump 55% yoy
JP MORGAN outperformed rivals CITIGROUP and At JP Morgan, revenue from investment ECM. Revenue from equity underwriting fell
MORGAN STANLEY last quarter despite taking a banking plunged 47% in Q3 to US$1.76bn as 79% to US$100m in the quarter, debt
nearly US$1bn hit on securities investments, transactions in M&A, debt and equity underwriting slumped 82% to US$139m and
ASûREVENUEûFROMûlXEDûINCOMEûTRADINGû underwriting continued to erode compared revenue from advisory fell 27% to US$392m.
surged to lift its markets revenue to a new with last year. Revenue from debt In trading, FICC was more muted than
record for a third quarter. underwriting in the quarter fell 40% to peers in the quarter, rising 1% to US$3.1bn
"UTûWHILEûlXEDûINCOMEûTRADINGûSURGEDû US$624m while revenue from equity on strength in rates and currencies, but hurt
investment banking revenue slumped at all underwriting slumped 72% to US$290m. by continued headwinds in spread products,
three banks as companies shied away from Revenue from advisory fell 31% to US$848m. the bank said. Revenue from equity trading
M&A transactions in volatile markets and FICC trading again helped save the quarter fell 25% to US$1bn.
underwriting remained stalled. That continued on the back of strong trends in rates, FX and #ITISûTOTALûPROlTûFELLûûTOû53BNû
TRENDSûSEENûINûTHEûlRSTûSIXûMONTHSûOFûTHEûYEAR commodities and strong client activity. JP primarily driven by higher cost of credit and
Investment banking revenue in the July- Morgan’s FICC revenue rose 22% to US$4.5bn HIGHERûEXPENSESûPARTIALLYûOFFSETûBYûANû
September quarter for JP Morgan, Citi and in the quarter, more than offsetting an 11% increase in revenues. Revenues rose 6% to
Morgan Stanley fell 54% in aggregate from a fall in equity trading revenues to US$2.3bn, US$18.5bn.
YEARûEARLIERû2EVENUEûFROMûlXEDûINCOMEû hurt by lower balances in prime and lower Citi said it will end nearly all of the
currency and commodities trading rose 16%, cash and block activity. institutional banking services it offers in
while revenue from equity trading fell 15% JP Morgan earned US$9.7bn in the quarter, 2USSIAûBYûTHEûENDûOFûTHEûlRSTûQUARTERûOFû
on average in the quarter. down 17% from a year earlier, as it was hit by a Morgan Stanley was better able to capture
Bank chiefs were also optimistic the net credit reserve build of US$808m compared trends in FICC in the quarter with revenue
DEALmOWûWILLûRETURNûh!DVISORYûANDû with a release of US$2.1bn a year ago. Total rising 33% to US$2.2bn. But revenue from its
underwriting activity has not gone away, it provision for credit losses in the quarter was dominant equity trading franchise fell 14%
has simply been deferred,” said Morgan US$1.5bn. The current quarter also included to US$2.5bn.
Stanley CEO James Gorman. hNETûINVESTMENTûSECURITIESûLOSSESvûOFû53Mû h)FûYOUûGOûBACKûAûDECADEûANDûYOUûHADûALLûRATESû
as a result of repositioning the portfolio by at zero for every economy and all of a sudden,
FICC GOOD, EQUITIES BAD, IBD VERY UGLY: selling US Treasuries and mortgages. you’ve moved to a place where you have
Q3 REVENUES % CHANGE YOY
As the Federal Reserve continued to hike divergent views,” Morgan Stanley CFO Sharon
%
40 INTERESTûRATESû*0û-ORGANûREAPEDûTHEûBENElTSû 9ESHAYAûTOLDûANALYSTSûEXPLAININGûTHEûSURGEûINû
30 with net interest income rising 34% to FICC. The shift has led to higher volatility and
20 US$17.6bn in Q3. higher client engagement, she said.
10
The bank continued to struggle with rising In investment banking, revenue fell 55%
0
-10 EXPENSESûHOWEVERûANDûNON INTERESTû to US$1.3bn as the bank said ongoing
-20 EXPENSESûINû1ûROSEûûTOû53BNûDRIVENû market volatility continued to weigh on
-30 BYûHIGHERûSTRUCTURALûEXPENSEûPRIMARILYû issuance and led clients to delay strategic
-40
-50
compensation. Total headcount rose 9% to actions. Revenue from M&A fell 46% to
-60 288,474, including an 8% increase in the US$693m. Revenue from debt underwriting
-70 corporate and investment bank to 71,797. fell 35% to US$366m as macroeconomic
M Stanley
Citigroup
Avg 3 US
banks
JP Morgan
-80
conditions contributed to lower issuances,
“DIVERGENT VIEWS” the bank said, while ECM revenue tumbled
Rival Citi faced tougher sledding in ûTOû53MûREmECTINGûTHEûSUBSTANTIALû
JFICC JEquities JAdv/Underwriting investment banking and its revenues slumped decline in global equity volumes.
Source: Bank results, IFR calculations 64% to US$631m on steep declines in DCM and Philip Scipio

h7EûAREûINûAûMOREûVOLATILEûGEOPOLITICALûENVIRONMENTûWHICHû
is affecting both markets and corporate decision-making”
PETER ORSZAG, CEO OF FINANCIAL ADVISORY AT LAZARD, P15
Cowen big six set for US$223m payday from TD deal

COWENSûTOPûSIXûEXECUTIVESûWILLûSHAREûAû retention bonuses to keep top bankers, but it Wieseneck, a former senior Barclays and
windfall payout of about US$223m from the did not say how many staff would be sharing Lehman Brothers banker who heads
takeover of the US advisory boutique by that, or how the pay would be structured. investment banking, are each in line to
Canada’s TORONTO-DOMINION BANK, and the +EEPINGûTOPûEXECUTIVESûANDûBANKERSûISû receive US$36.5m, made up of a US$31.5m
SCALEûOFûTHEûSO CALLEDûhGOLDENûPARACHUTESvû seen as a crucial element for any takeover in retention bonus and US$5m integration
ALMOSTûDERAILEDûTHEûDEALûAûREGULATORYûlLINGû investment banking. Credit Suisse’s bonus. They will also receive payment for
shows. takeover of Donaldson, Lufkin & Jenrette in DEFERREDûSHAREûAWARDSûBUTûTHEûlLINGûDOESû
4HEûEXECUTIVESûCOULDûHAVEûRECEIVEDûEVENû 2000 has gone down in history as a deal not disclose how much they hold.
more under their contractual terms – up to where much of the value walked out of the *OHNû(OLMESûCHIEFûOPERATINGûOFlCERû#&/û
US$371m – but the size of the payout and door soon after completion – including a Stephen Lasota and general counsel Owen
PROMISEûOFûBIGûBONUSESûONCEûTHEûSIXûMENû team led by Ken Moelis. Littman are also due to get retention awards
join TD show the Canadian bank will face of US$9m–$10m each, on top of buyouts of
integration challenges and potential friction Discussions between TD and deferred share awards.
WITHûEXISTINGûSTAFFûINûITSûATTEMPTûTOûBECOMEûAû )NûTHEORYûTHEûEXECUTIVESûCOULDûHAVEû
bigger player in US capital markets.
Cowen about payments to received US$148m more under the terms of
The rest of Cowen’s roughly 1,530 staff executives and reducing the their Cowen golden parachutes, including
will share retention awards of up to “change of control” obligations US$229m in severance entitlements, but the
US$60m, although TD will also pay certain were a major part of the deal lLINGûSHOWSû4$ûWASûNEVERûPREPAREDûTOûPAYû
STAFFûAûSPECIlEDûLEVELûOFûCOMPENSATIONûNEXTû negotiations that amount.
year that could tally up to another US$225m. The US$60m retention award for all other
4HEûREGULATORYûlLINGûALSOûSHOWSûFOURû 4HEû53MûEARMARKEDûFORûTHEûTOPûSIXûATû staff is payable in TD shares on the third
OTHERûlRMSûAPPROACHEDû#OWENûANDûITSû Cowen comprises US$129m of retention anniversary. No individual will get more
advisers in the months before it agreed its awards, integration bonuses of US$18m and than US$3m. TD will also pay the 2022
takeover by TD. None of the other suitors buyouts of deferred stock awards they had bonus pool for Cowen staff and has agreed
were named, but the most serious of them built up that are worth US$77m – and which TOûPAYûCERTAINûEMPLOYEESûAûSPECIlEDûLEVELûOFû
WASûDETERREDûBYûTHEûHIGHûhCHANGEûOFû they were due to receive over time compensation until the end of October
CONTROLvûPAYOUTûFORûEXECUTIVESûANDûRISKSû REGARDLESSûOFûTHEûTAKEOVERûTHEûlLINGûSHOWSû 2023, which could be up to US$225m.
ABOUTûCULTURALûlT They need to stay for three years to get the It is not clear how the US$285m will be
4HEûlLINGûONû4UESDAYûGIVESûDETAILSûANDû full payout. They are also entitled to bonuses split. Sources at rival banks said they have
background for Cowen shareholders, who for 2022, which will be determined by received interest from bankers at Cowen in
have to approve the deal by a 51% majority Cowen’s compensation committee. recent months. At the end of 2021, Cowen
in a vote on November 15. It also gives a #HAIRMANûANDûCHIEFûEXECUTIVEû*EFFREYû had 1,264 staff in the US, 259 in Europe and
glimpse into negotiations to buy an Solomon will receive US$71.7m, including 11 in Asia.
investment bank – and show why they are US$26.2m for the 2.4% stake he has built up 4HEûlLINGûSHOWSûDISCUSSIONSûBETWEENû4$û
rare and often run into bumps. in Cowen from past awards. He will also ANDû#OWENûABOUTûPAYMENTSûTOûEXECUTIVESû
receive US$12.67m as a closing retention ANDûREDUCINGûTHEûhCHANGEûOFûCONTROLvû
RETENTION AND INTEGRATION bonus; US$25m in a deferred retention obligations were a major part of the deal
TD Bank announced on August 2 it was BONUSûWHEREûONE THIRDûISûPAIDûONûTHEûlRSTû negotiations, but so was the risk of losing
buying New York-based Cowen for US$1.3bn second and third anniversaries of closing; staff. When TD made a non-binding
INûCASHûORû53ûPERûSHAREûTOûEXPANDûITSû and an integration bonus of US$7.5m. proposal in June, it was conditional on
capital markets reach in the US. TD disclosed $ANû#HARNEYûAûFORMERû*EFFERIESûEXECUTIVEû IMPLEMENTINGûNEWûhCHANGEûOFûCONTROLvû
at the time it will spend at least US$200m in who is Cowen’s head of markets, and Larry severance agreements.
Who’s moving where…

Rick Polhemus has advise firms on the HOULIHAN LOKEY founding member and
joined MOELIS & changing landscape hired Keith Skirbe as a managing director.
CO from Morgan of technology and managing director in Skirbe started his
Stanley to provide energy transition. its global technology career at NationsBank/
strategic and financial He spent 11 years group, covering Bank of America in
advice to companies at Morgan Stanley, the cybersecurity the asset-backed
in technology, most recently as head sector. He will work securitisations and
sustainability and of western region from San Francisco. debt private placement
services sectors, based investment banking. Skirbe joined from groups. He has also
in San Francisco. boutique cybersecurity worked in investment
Polhemus has joined investment bank banking at Bear
as a managing Momentum Cyber, Stearns, FT Partners
director and will where he was a and SG Cowen.

People
& Markets
4HEûSIXû#OWENûEXECUTIVESûALSOûSTANDûTOûBEû
some of the highest paid staff at TD when
Cineworld looks to carve out
the acquisition completes.
Solomon will join TD Securities’ senior
original business
leadership and run a combined capital In an audacious move CINEWORLD is The other ad hoc group of creditors,
markets business called TD Cowen, a attempting to carve out the oldest portion of including those holding the term loan B
division of TD Securities. Charney will be its business, based in Israel and Eastern facilities, have offered to put in a
co-head of global markets at TD Securities Europe, and leave the UK and US businesses US$1.935bn debtor-in-possession facility,
and Wieseneck will be co-head of global it more recently acquired behind in the which would have senior secured
investment banking, and both will be ongoing Chapter 11 process. superpriority status and effectively stand to
vice-chairs of TD Cowen. That is likely to lead to the latter being taken take control of the US and UK businesses.
Solomon will get a base salary of US$1m over by creditors. If so, family shareholders of The ad hoc group had already put in
and Charney and Wiesenech will each get the beleaguered cinema chain are well placed US$850m of priming loans prior to the
US$750,000. For 2023, Solomon will receive to regain control of the business upon which Chapter 11 petition, leaving them in the
a minimum bonus of US$9m and Charney the empire was subsequently built via a series driving seat of the restructuring.
and Wiesenech are each set to get a of leveraged acquisitions, assuming all goes Some US$271m of the DIP facility is
minimum bonus of US$7.75m. according to plan. earmarked to buy out the loans attached to the
The development has affected the price of Israel and Eastern Europe division. That will
OTHER SUITORS Cineworld’s term loan B facilities, since it leave that part debt-free, increasing its
TD’s courtship of Cowen began when Riaz could mean those creditors ultimately have attractiveness to potential purchasers, such as
Ahmed, head of TD Securities, contacted access to fewer recoverable assets. Its the founding Greidinger family. Brothers Mooky
Solomon in January and had a meeting in US$3.325bn and €607.6m portions touched and Israel Greidinger manage the group.
March where they started discussing an record lows of between 37% and 39% of face
ALLIANCEû"UTûTHEûlLINGûSHOWSûFOURûOTHERû value in the secondary market last week. The development has hit the
lRMSûALSOûSHOWEDûINTERESTûINû#OWEN These loans, taken out in 2018 to fund the
One company, described as a global US$5.8bn purchase of US chain Regal, traded
price of Cineworld’s term loan
lNANCIALûINSTITUTIONûAPPROACHEDû#OWENû ATûAROUNDûûBEFOREûTHEûGROUPûlLEDûFORû B facilities as it could mean
in March and later made a non-binding bankruptcy protection in the US on creditors have access to fewer
cash proposal at US$40 per share. But September 7. recoverable assets
after months of talks, a representative
of the bank told Solomon on July 8 it REGAL AND CINEMA CITY A creditors meeting is due to take place
hWOULDûNOTûBEûABLEûTOûREACHûMUTUALû The Regal cinemas, with nearly 7,000 on October 17.
agreement with management on its screens, make up the bulk of the group’s Cineworld declined to comment. But at the
proposed retention package for the business. The UK portion, mainly branded end of September the group said it hoped to
EXECUTIVESvûANDûSAIDûTHEûhRETENTIONûANDû Cineworld, and those in Israel and Eastern EMERGEûFROMû#HAPTERûûINûTHEûlRSTûQUARTERûOFû
organisational structures would be too Europe, called Cinema City, each have ûh#INEWORLDûLOOKSûFORWARDûTOûWORKINGû
disruptive” to its business. around 1,000 screens. with its creditors and stakeholders to advance
#OWENSûDIRECTORSûANDûEXECUTIVESûOWNû Cineworld’s presentation to the US courts the group’s efforts to restructure its balance
6.6% of the shares and said they will vote WHENûlLINGûFORû#HAPTERûûSETûOUTûINûSOMEû sheet,” it said, adding that it would provide
in favour of the deal on November 15. detail the plan to carve-out the Israel and FURTHERûUPDATESûhINûDUEûCOURSEv
Shareholders will also have a separate Eastern Europe parts from the rest of the PJT and AlixPartners are advising Cineworld
vote to approve the compensation proposal group. The Israel/Eastern Europe part of the ONûTHEûRESTRUCTURINGûTOGETHERûWITHûLAWûlRMSû
of the deal – but that is only an advisory business has a US$250m secured loan agreed Kirkland & Ellis and Slaughter and May.
vote. in July 2020 and privately placed with Christopher Spink
Steve Slater institutions. Additional reporting by Chris Mangham
Please contact us if you have information about job moves: people.markets@lseg.com
Dominic Emery has managing director WELLS FARGO than a decade, most
joined US boutique in M&A advisory. He has hired Sesh recently as an MD in
investment bank previously worked at Raghavan as head of its power, utilities and
WILLIAM BLAIR Investec for nine years, power, utilities and renewables group. He
as a managing at Close Brothers renewables M&A. He previously worked at
director in London to for a year and at will be a managing Lexicon Partners and
advise clients in the Robson Rhodes for director and work from JP Morgan.
technology sector, three years. Emery New York, reporting
part of its expansion in has experience to global head of
Europe. Emery joined across M&A and M&A David DeNunzio.
from Raymond James, financial advisory with Raghavan joined
where he has worked public and private from Evercore, where
for five years as a companies. he worked for more

Bellwether
Bellwether: n. From the practice of placing a bell around the the Savoy would certainly help – although the bigger
neck of a castrated ram so that it might lead its flock question is how Credit Suisse became the biggest
SHAREHOLDERûINûAûPRESTIGIOUSûHOTELûINûTHEûlRSTûPLACE
IN FOOTBALL ANDûlNANCEûTWOûTHINGSûAREûINEVITABLEû)Nû .EVERûMINDûhDOINGûAû5"3vû#REDITû3UISSEûISûFASTû
football, Man City’s superstar striker Erling Haaland can emulating Deutsche, which in the bad old days ended
ALWAYSûBEûRELIEDûONûTOûSCOREûWHILEûINûlNANCEû-ONTEûDEIû up owning a casino in Las Vegas. And as if being tied
Paschi di Siena can always be relied on to raise capital. up with one swanky hotel wasn’t enough, Credit Suisse
Haaland has scored 15 goals in nine Premier League has also now been dragged into a legal dispute between
appearances but is that more impressive than MPS, the co-owners of Claridge’s, the landmark London hotel.
which has raised capital a record seven times in 14 Maybe it’s time to do a runner.
YEARSû%VENû$EUTSCHEû"ANKûTHEûSELF STYLEDûhFOXûINûTHEû There’s only one slight hitch with the planned Savoy
$AXvûONLYûMANAGEDûFOUR sale – the hotel is currently closed for renovation and
And while Deutsche has opted for a rock-solid balance NOTûDUEûTOûREOPENûUNTILûMID û)TSûSOMEHOWûlTTINGû
sheet, the Italian capital-raising machine shows no sign Credit Suisse is undergoing a renovation of its own,
of slowing down and is set to add to its tally with its although when and whether its investment bank will
latest protracted €2.5bn cash call, which is likely to get ever fully reopen is anyone’s guess.
over the line after once again shrugging off some stiff
opposition. ACCOUNTANCY FIRMS USUALLY hit the
But when you analyse it, at the end of the day, no Credit headlines over auditing failures
other company has been allowed so much time and Suisse is fast but there seems to be a darker
space by regulators or lending banks when it comes to emulating side of bean-counting.
raising capital. Deutsche, Stephen Cahill has retired as
!NDûJUSTûASû(AALANDûISûlRMLYûONûCOURSEûFORûTHEû'OLDENû vice-chairman of Deloitte after
Boot for the most goals scored, isn’t it about time MPS
which in getting pissed and behaving like
was recognised for its services to the enrichment of the bad old a dick (according to the Financial
investment bankers with the Golden Underwriting days ended Times, although maybe not in
Agreement? up owning a EXACTLYûTHOSEûWORDS ûATû2OYALû
casino in Las Ascot.
CREDIT SUISSE APPEARSûTOûHAVEûADOPTEDûANûhEVERYûLITTLEû Accountants will know that
helps” approach to staving off a potential cash call.
Vegas for every debit there must be a
4HEûGAFFE PRONEûBANKûISûSELLINGûTHEûlVE STARû3AVOYû corresponding credit but Cahill
Hotel in Zurich and is hoping to bring in SFr400m. certainly seems to have blotted his copybook in a way
Analysts have suggested the bank may need to raise THATûISûIMPOSSIBLEûFORû$ELOITTEûTOûhRECONCILEvûWITHûITSû
ASûMUCHûASû3&RBNûINûANûADVERSEûSCENARIOûSOûmOGGINGû public image.
Who’s moving where…

TRUIST told IFR. He will work BNP PARIBAS Paribas to build up in NOMURA has his existing role as co-
SECURITIES has closely with Greg has hired Paul Barker equities, after buying rejigged its debt head of loans for Asia
appointed Chris Ogborn, a managing as a senior trader in the bulk of the prime capital markets ex-Japan. Oliver Holt,
Cormier to head tech, director in TMT ECM, its European Union broking business from leadership team in head of syndicated
media and telecoms to help expand the single stock trading Deutsche Bank and line with an increased debt capital markets
within equity capital business. Cormier team, based in Credit Suisse and focus on private for Asia ex-Japan
markets, an expansion joins from UBS, where London. Barker was taking the half-share market activity and will have an added
of the group in a slow he led TMT ECM, after previously at Citigroup of equity research bespoke solutions. responsibility of
funding environment. prior stints at Bank and before that at and trading business Abhishek Tiwaari handling DCM
Cormier will be based of America, Deutsche Morgan Stanley, Exane that it did not will assume the new origination for Asia
in New York and Bank and Credit working in a similar already own. role of head of debt ex-Japan investment
report to ECM head Suisse. area. The hire is part origination for Asia ex- grade. Holt is based in
West Riggs, a source of a push by BNP Japan, in addition to Singapore.

People
& Markets
Lazard sets up geopolitical advisory team
LAZARD has hired Jami Miscik as a senior TOûHERûEXPERIENCEûINûhINTELLIGENCEûGATHERINGû strategic counsel we provide to corporate
adviser for a new geopolitical advisory analysis, government, corporate boards and leadership and boards.”
group, alongside senior advisers John lNANCIALûSERVICESv The group is run by Theodore Bunzel in
Abizaid and William McRaven. Lazard’s geopolitical advisory group will New York and David Kaufman in Austin,
Miscik joins Lazard from geopolitical provide corporate leaders with bespoke 4EXASû-ISCIKûWILLûWORKûFROMû,OSû!NGELES
CONSULTINGûlRMû+ISSINGERû!SSOCIATESû strategic insights into relevant geopolitical Abizaid joined Lazard in February as a
founded by Henry Kissinger, where she was trends – advising clients on risks, SENIORûADVISERûINûITSûlNANCIALûADVISORYû
CHIEFûEXECUTIVEû3HEûCURRENTLYûSERVESûONûTHEû opportunities and how key developments business, mostly focused on the Middle East
boards of Morgan Stanley, General Motors may translate into business impact. and Europe. He is a former commander of
and HP, and is a former deputy director for h7EûAREûINûAûFUNDAMENTALLYûMOREûVOLATILEû US Central Command and US Ambassador to
intelligence at the Central Intelligence geopolitical environment, which is affecting Saudi Arabia, and has advised US presidents.
Agency, where she worked for more than 20 both markets and corporate decision- -C2AVENûJOINEDûINû-AYûALSOûINûTHEûlNANCIALû
years. Earlier in her career she was global MAKINGvûSAIDû0ETERû/RSZAGû#%/ûOFûlNANCIALû advisory business. The retired US Navy
head of sovereign risk for Lehman Brothers. ADVISORYûATû,AZARDûh0ROVIDINGûADVICEûONû admiral is a former head of the US Special
,AZARDûSAIDû-ISCIKûWILLûBEûANûhIDEALûlTvûFORû navigating the geopolitical landscape is a Operations Command.
the new geopolitical advisory team thanks NATURALûEXTENSIONûTOûTHEûBEST INûCLASSû Philip Scipio
CS calls for ‘more sophisticated’ ESG analysis

#REDITû3UISSEûISûCALLINGûFORûhMOREû AREûNOTûNECESSARILYûSECTOR SPECIlCû4HEYû AûPARTICULARûCOMPANYûISûEXPOSEDûTOû
sophisticated” ESG analysis that combines might be coming from very different sustainable themes,” it said.
top-down thematic research with traditional angles,” he said, noting that as a result a Klerk said investors will need thematic
bottom-up company insights and modelling. COMBINEDûTOP DOWNBOTTOM UPûAPPROACHûhISû approaches to outperform in future.
With the increasing availability of geospatial not common at all”. h9OUûHAVEûTOûUNDERSTANDûHOWûCOMPANIESû
and other types of granular location data, Against this background and with 36% are impacted by broader themes
THISûNEXT LEVELûAPPROACHûSHOULDûALSOûDRAWû OFûALLûlNANCIALûASSETSûGLOBALLYûALREADYû because they are the ones that determine,
heavily on data science, it said. being managed under sustainable strategies ultimately, failure and success,” he
4HEûlRMSûNEWûh4REEPRINTvûSERIESû LASTûYEARû#3ûISûPUSHINGûAûhSUSTAINABLEû said.
EXEMPLIlESûTHISûAPPROACHûANDûBREAKSûNEWû analytic framework”. This comprises At the same time, the best opportunities
ground, it claimed. more than 20 mainly environmental under broad themes such as the energy
h7HENû)ûLISTENûTOûINVESTORSûWHATûTHEYû TOPICSûTHATûITûEXPECTSûTOûhDOMINATEû transition and adoption of renewables may
tend to say is that no broker really has investor agendas for years to come”, NOTûBEûOBVIOUSû+LERKûGIVESûTHEûEXAMPLEûOFû
properly integrated all relevant aspects of PLUSûSUB THEMESûANDûlVEûOVERARCHINGû less visible companies in the supply chain of
sustainable analysis into their day-to-day categories. sector favourites.
research product,” said Eugene Klerk, global 4HEûlRMûSAIDûSUSTAINABILITY LINKEDû h-AYBEûTHEûMARKETûISûFARûLESSûEFlCIENTûINû
head of ESG research. thematic investing has seen the fastest understanding whether a company that is
In particular, thematic work is lacking. growth of any major ESG investment indirectly impacted by a particular theme is
h4HERESûFARûLESSûEXPERIENCEûKNOWLEDGEûANDû STRATEGYûINûRECENTûYEARSûh7EûBELIEVEûTHISûISû properly priced than the companies that
development on that side. It’s cross-sector likely to continue, suggesting that investors everyone knows about,” he said.
and cross-geographies. Some of the drivers have an increasing need to understand how Julian Lewis
Please contact us if you have information about job moves: people.markets@lseg.com
GOLDMAN SACHS Antoine Thibaud MORGAN STANLEY SOCIETE has relocated from ANZ BANK has
has appointed Cristina has joined MUFG has named Rikhit GENERALE has Singapore to head appointed Michael
Estrada, current COO SECURITIES as a Badalia as M&A head made several senior the energy+ group for Isaacs as co-head of
of Latin America director in its credit for South-East Asia, appointments Australia in Sydney. origination, leveraged
financing group, as trading team, based in Reuters reported. in Australia and Aaron Borg has been and acquisition
co-head of investment Hong Kong. Thibaud Hong Kong-based Singapore. Tom appointed co-head of finance for Australia.
banking in Brazil, was previously co- Badalia takes over Lukic has been mining, metals and Isaacs was previously
Reuters reported. founder and portfolio from Jonathan Pflug, hired from Westpac industries finance for executive director of
Estrada will be manager at 1020 who is joining US to head corporate Asia-Pacific, based in loan syndications at
transferred from New Capital Management, investment bank client coverage for Sydney. Eugene Tan ANZ in Sydney.
York to Brazil and will and before that was Raine Group. Australia and New has joined as director
work alongside co- a trader at Citic CLSA Zealand, based in for TMT in Singapore.
head Ricardo Bellissi. and UBS. Sydney. Ben Arnott

h!DVISORYûANDûUNDERWRITINGûACTIVITYûHASû
not gone away, it has simply been deferred”
MORGAN STANLEY CEO JAMES GORMAN, P11
FSB wants crypto regulation amid

challenging outlook
Dutch central bank president Klaas Knot has The aim is to strengthen the resilience of h#ONCERNSûABOUTûTHEûRISKSûTHEYûPOSEûTOû
SAIDûTHEûOUTLOOKûFORûGLOBALûlNANCIALûSTABILITYû NON BANKûlNANCIALûINTERMEDIATIONû4HOSEû lNANCIALûSTABILITYûAREûTHEREFOREûLIKELYûTOû
REMAINSûhCHALLENGINGvûWITHûINmATIONûRISINGû risks have been highlighted recently in the come back to the fore sooner rather than
and the economic outlook weakening over UK with pension funds relying on the Bank LATERûASûAREûPUBLICûEXPECTATIONSûTHATû
the last quarter. of England to provide support to the Gilts policymakers have in place a robust
He made the remarks in a letter to fellow market after the surprise mini-budget international framework to identify,
central bank governors of the group of 20 GENERATEDûEXAGGERATEDûSELLING monitor and address those risks,” Knot said.
leading economies as well as those The FSB also highlighted the growing
COUNTRIESûlNANCEûMINISTERSûASûCHAIRûOFûTHEû “INTRINSIC VOLATILITY” number and sophistication of cyber
&INANCIALû3TABILITYû"OARDû4HEû'ûlNANCIALû The report on cryptoassets was released incidents as a concern.
heads met last week in Washington during on Tuesday. The FSB said its previous h'ROWINGûINTERCONNECTEDNESSûOFûTHEû
the IMF annual meetings. concerns about the market were validated lNANCIALûSYSTEMûINCREASESûTHEûLIKELIHOODûOFû
Knot said the FSB would continue to work by the turmoil seen in these markets AûCYBERûINCIDENTûATûONEûlNANCIALûINSTITUTIONû
WITHûITSûMEMBERSûhTOûTACKLEûCURRENTû in recent months. It showed their or an incident at one of its third-party
lNANCIALûSTABILITYûISSUESûINCLUDINGûTHOSEû hINTRINSICûVOLATILITYûANDûSTRUCTURALû service providers, having spillover effects
related to commodity markets or hidden vulnerabilities”. across borders and sectors,” said Knot.
leverage”. Because of the risks demonstrated The FSB said it wanted to see more
4HEûBOARDûISûWORKINGûONûSEVERALûSIGNIlCANTû when one intermediary fails, the FSB reporting of these events so responses could
INITIATIVESûADDRESSINGûhIMPORTANTûSTRUCTURALû SAIDûITûhUNDERLINEDûTHEûNEEDûFORûAû be more effective.
CHANGESûAFFECTINGûTHEûlNANCIALûSYSTEMvû4HEû comprehensive approach to cryptoasset h4HEûCHALLENGINGûCOMBINATIONûOFûRAPIDLYû
whole suite of reports, covering cryptoassets, regulation”. The report recommended such EVOLVINGûlNANCIALûCONDITIONSûANDûSWIFTû
cross-border payments, cyber risk, and ANûAPPROACHûTOûCOVERûhANYûTYPEûOFû STRUCTURALûCHANGEûINûTHEûlNANCIALûSYSTEMû
climate change will be presented to G20 cryptoasset activity”, including issuers and may be with us for some time,” said Knot.
LEADERSûNEXTûMONTH trading platforms. Christopher Spink
Oxfam, World Bank face off over climate finance

OXFAM has raised doubts over the size and !LONGûWITHûLEADERSûFROMûhAûBROADûGROUPûOFû also mean the World Bank is understating its
accuracy of the World Bank’s reported countries”, she called on World Bank CLIMATEûlNANCINGû/XFAMûPOINTSûOUTûTHATûITSû
CLIMATEûlNANCINGûCHARGESûTHEû7ASHINGTON management at last week’s annual meetings share could be as low as 19.4%.
headquartered development lender rejects. INû7ASHINGTONûhTOûWORKûWITHûSHAREHOLDERSû h/URûCONCERNûISûTHEûWORST CASEûSCENARIOûnû
The spat comes as pressure rises on World to develop a World Bank evolution roadmap THATûTHEûBANKûCOULDûBEûSIGNIlCANTLYû
Bank president David Malpass after he BYû$ECEMBERvû3HEûEXPECTSûhDEEPERûWORKvûTOû overstating its contribution,” said Nafkote
recently appeared to deny human BEGINûBYûNEXTûSPRINGû Dabi, international climate policy lead at
involvement in climate change – though he )NûAûNEWûREPORTûCALLEDûh5NACCOUNTABLEû /XFAM
LATERûSAIDûHISûMESSAGEûHADûBEENûhTANGLEDv !CCOUNTINGvû/XFAMûSAIDûhTHEû7ORLDû"ANKû h)TûISûALARMINGûnûATûAûTIMEûWHENûCLIMATEû
Criticism of the Donald Trump appointee- supplies very little evidence to support its change is driving such damage and poverty
led World Bank from the likes of former US CLAIMSûABOUTûTHEûAMOUNTûOFûCLIMATEûlNANCEû and hunger around the world – that we
vice-president Al Gore and Selwin Hart, special it provides” despite being the largest COULDûlNDûSOûLITTLEûCLARITYûABOUTûTHEûQUALITYû
adviser to the United Nations secretary multilateral lender to low and middle- ANDûQUANTITYûOFûTHESEûlNANCIALûmOWSvû$ABIû
general on climate action and just transition, income countries. According to World Bank said, terming the World Bank’s public
rose after November’s COP26 climate summit calculations, its US$21.3bn from all group DISCLOSUREûhAûFAULTYûTHERMOMETERv
in Glasgow. The institution has yet to align its entities accounted for 56% of development 4HEû7ORLDû"ANKûDISPUTESû/XFAMSû
lNANCINGûWITHûLIMITINGûWARMINGûTOû#û(ARTû LENDERSûTOTALûCLIMATEûlNANCINGûINû account. It said it uses the joint multilateral
SAIDûHEûWASûhCOMPELLEDûTOûSINGLEûOUTûTHEû "UTû/XFAMûSAIDûhTHEûBANKSûCURRENTû development bank methodology to calculate
World Bank as an ongoing underperformer”. CLIMATEûlNANCEûREPORTINGûPROCESSESûAREûSUCHû hCO BENElTSvûFROMûPROJECTSûTHATûSUPPORTû
4HEûCOMPLAINTSûHAVEûINTENSIlEDûTHISûYEARû THATûITSûCLAIMEDûLEVELSûOFûCLIMATEûlNANCEû CLIMATEûACTIONûANDûOTHERûSOCIALûGOODSûh7Eû
In June the US Treasury – the World Bank’s CANNOTûBEûINDEPENDENTLYûVERIlEDvû!SûAû are rigorous about how we apply the
largest shareholder – told the institution it RESULTûTHESEûhCOULDûBEûOFFvûBYûASûMUCHûASû METHODOLOGYûANDûONLYûASSIGNûCO BENElTSûFORû
SAWûhSPECIlCûGAPSûANDûROOMûFORûINCREASEDû US$7bn, or 40%. THEûSHAREûOFûlNANCINGûINûAûGIVENûPROJECTûTHATû
climate ambition”. US Treasury Secretary %RRORûOFûTHISûSCALEûhCALLSûINTOûQUESTIONvûTHEû is directly tied to climate action,” a
Janet Yellen this month reinforced that in a World Bank’s claim of having met its goal of spokesperson said.
SPEECHûTHATûDEMANDEDûhRETHINKINGû 28% of its total 2020 commitments being h7EûSTANDûBYûOURûASSESSMENTûOFû
DEVELOPMENTûlNANCEvûANDûhEVOLVINGûOURû CLIMATEûlNANCINGû/XFAMûSAIDû!LTHOUGHû CO BENElTSv
multilateral development bank system”. WHATû/XFAMûTREATSûASûmAWSûINûREPORTINGûCOULDû Julian Lewis

People
& Markets
Japan’s green transition hits speed bump
Just over a year has passed since NYK Line cannibalisation with other oil companies, since it looks unlikely to achieve it on its own
SOLDû*APANSûlRSTûTRANSITIONûBONDSûINû*ULYû such as ENEOS Holdings, which had sold GIVENûITSûINSUFlCIENTûCARBONûCREDITSû"UTû*APANSû
ûBUTûTHEûCOUNTRYSûTRANSITIONûlNANCEû transition bonds earlier in June, and elevated decarbonisation initiatives have failed to
initiatives have already hit a speed bump. volatility. garner global attention.
With issuers now cautious because the Some investors praised the transition- h.OûONEûWASûINûTHEûMOODûTOûDEBATEû
market environment has deteriorated, labelled issues, but others were hesitant to decarbonisation at important international
especially since Russia invaded Ukraine, and INCREASEûTHEIRûEXPOSUREûTOûTHEûOILûSECTORûWHICHû meetings, especially after the Russian invasion
bond investors struggling to meet growing is vulnerable to the impact of decarbonisation. OFû5KRAINEvûSAIDûAûGOVERNMENTûOFlCIAL
calls from the international community for A third source said issuers had been Japan hopes it can gain attention if it can
portfolio decarbonisation, additional efforts DISAPPOINTEDûBYûTHEûPOTENTIALûBENElTSûOFû come up with science-based reduction
AREûNEEDEDûFORûTHISûMARKETûTOûFURTHERûEXPANDû issuing transition bonds. Because of the forecasts and present them at international
Transition bond issuance from April to deteriorating market environment, issuers conferences, such as COP27 in November. To
!UGUSTûWASûABOUTûcBNû53BN ûUPûMOREû are instead leaning towards transition-linked make its initiatives known globally, it also
than 10% from a year earlier, marking a slow loans, which require higher transition goals plans to strengthen cooperation with South-
and quiet start in the Japanese environmental, but can receive an interest rate subsidy of up East Asia through technology support for
social and governance bond market. to 20bp from the Ministry of Economy, Trade emerging economies.
Most issuance of bonds backed by and Industry. Japan plans to sell new green transition
transition strategies has come from the bonds with the aim of encouraging more
BIGGESTûlRMSûINûTHEIRûINDUSTRIESûBUTûSMALLû NO CLEAR POLICY private investments in low-carbon
and mid-sized companies are also interested Carbon-intensive companies need to maintain technologies and industries. The details of
in issuing transition bonds. A banker at a access to the debt capital markets because of the sovereign bond sale, including the use of
SECURITIESûlRMûTOLDû$EAL7ATCHû)&2SûSISTERû the large amount of funding needed to proceeds and the tenors to be used, will be
publication, that he now receives a lot more transition to lower carbon businesses, but decided by the end of the year. Japan is
questions from SMEs about what they can do investors often worry about how the changes considering selling seven and 10-year
to begin issuing transition bonds. involved in decarbonisation will affect credit maturities and obtaining a third-party
The increasing awareness from issuers will strength. To help them assess the future of assessment, DealWatch reported.
not necessarily translate into a wave of new those companies, METI is considering Many market participants are concerned
issues. A second banker said transition and updating its sector roadmap by adding THATû*APANûHASûNOTûEXPRESSEDûITSûENERGYû
transition-linked bond issuance in the numeric emission reduction targets in each policy clearly, especially since it differs from
SECONDûHALFûOFûTHEûlSCALûYEARûFROMû/CTOBERû carbon-intensive industry. Europe’s approach.
to March, is likely to be smaller than in the The market would welcome such a move, h'IVENûTHEûSUNKûCOSTSû)ûDONTûHAVEûAûSENSEû
lRSTûHALFûESPECIALLYûAFTERûRECENTûDEALSûSAWû BUTû-%4)ûISûSAIDûTOûBEûSTRUGGLINGûTOûlNALISEû of malaise about the government’s plan to
MIXEDûRECEPTIONS the targets as the business sector is restart the nuclear power plants, but I do
MITSUBISHI HEAVY INDUSTRIESûcBNû53M û wondering if Russia’s invasion of Ukraine, THINKûITûSHOULDûEXPLAINûWHYûITûWILLûBUILDûNEWû
lVE YEARûBONDûOFFERINGûINûEARLYû3EPTEMBERû and the resultant disruption to the global PLANTSvûSAIDûAûFOURTHûSOURCEûh4HEû%UROPEANû
was about three times subscribed, but energy market, may cause the global market would otherwise not understand, as
IDEMITSU KOSANSûcBNûTWO TRANCHEûlVEûANDû decarbonisation efforts to move backwards. they only see nuclear power as transitional
10-year bond transaction in July struggled to If Japan is to achieve carbon neutrality in measures for carbon neutrality.”
BUILDûUPûDEMANDû4HEûDIFlCULTYûWASûDUEûTOû 2050, it will need more support from overseas, Azumi Kuboki, Takahiro Okamoto
ESG to drive ‘systemic change’ TAXûPOLICYûASûPARTûOFûRESPONDINGûTOûTHEû

climate crisis. As part of this, its panel also
%3'ûWILLûDRIVEûhSYSTEMICûCHANGEvûINûTHEû TOWARDSûNETûZEROûHAVEûLAGGEDûhBYûû emphasised a need to focus on social and
lNANCIALûSERVICESûINDUSTRYûBYûûACCORDINGû lNANCIALûSERVICESûCAPITALûWILLûPLAYûAûCRUCIALûROLEû governance issues as well as environmental
to more than 30 CEOs and other prominent in delivering positive outcomes and helping to ONESûhTHEûBACKLASHûONûSOCIALûISSUESûISûOVERû
contributors to a new KPMG report. power the transition to sustainability”. customers want justice and equality”, it said.
4HEûREPORTûCITESû%3'ûASûONEûOFûlVEûAREASûWHEREû 4HEûREPORTûHIGHLIGHTSûTHEûINmATIONû 4HEûREPORTûSAIDûhEVERYûDECISIONûISûANû%3'û
CONTRIBUTORSûANDû+0-'ûEXPECTûCHANGEûTOûBEû hINSULATIONvûTHATûINVESTMENTSûINûGREENERû DECISIONvû4HISûREmECTSû%3'ûCRITERIAûBEINGû
most profound. The others are the industry’s infrastructure and renewable energy provide, embedded in many areas of lending and
changed economics due to data availability and TERMINGûTHEIRûRETURNSûhENTICINGvûANDûEXPECTINGû investment, while their impact potential
analysis; a power shift due to customers gaining THATûTHEûINDUSTRYûWILLûBEûAûhCRITICALûENABLERvûOFû increasingly drives capital allocation. The report’s
control of their data; an altered competitive these areas by making funding available. It also PANELûOFûCONTRIBUTORSûWASûNOTûCONlNEDûTOûBANKSû
landscape as business models multiply and STRESSEDûTHEûSIGNIlCANTûREPUTATIONALûRISKûOFû INCLUDINGûONEûCENTRALûBANKûnû.EWû:EALANDS û
adapt; and a liberation of talent. SUPPORTINGûhCLIMATE NEGATIVEûBUSINESSESvûASû "ESIDESûSTART UPSûANDûCLIMATEûEXPERTSûTECHûlRMSû
"UTûITûHELDûUPû%3'ûASûhARGUABLYvûCHIEFû WELLûASûTHEûlNANCIALûRISKûINûSTRANDEDûASSETS such as Microsoft, insurers and and private equity
AMONGûTHESEûTERMINGûITûhTHEûGREATûBEHAVIOURALû 2EmECTINGûTHEûAUDITûANDûCONSULTINGûlRMSû players including Blackstone were also
driver of system change”. Respondents OWNûSPECIALITIESû+0-'ûIDENTIlEDûAûNEEDûFORû interviewed, as well some KPMG leaders.
concluded that while the world’s efforts the industry to work with political leaders on Julian Lewis

h)TûISûALARMINGûxûTHATûWEûCOULDûlNDûSOûLITTLEûCLARITYû
ABOUTûTHEûQUALITYûANDûQUANTITYûOFûTHESEûlNANCIALûmOWSv
OXFAM’S NAFKOTE DABI ON WORLD BANK DATA ON CLIMATE FINANCE, P16
GIB AM launches sustainable corporate bond fund

UK-based GIB ASSET MANAGEMENT has launched WHOûWANTûTOûACCESSûGLOBALûlXEDûINCOMEû supported by a team of three with more
a sustainable corporate bond fund that aims MARKETSûINûAûWAYûTHATûTAPSûINTOûTHEûlNANCIALû THANûûYEARSûOFûCOMBINEDûlXEDûINCOMEû
to invest in companies tackling social and opportunities presented by challenges such EXPERIENCE
environmental challenges. as healthy nutrition, connectivity, clean h4HEûRESULTûISûAûBALANCEDûANDûDIVERSIlEDû
The GIB AM Sustainable World Corporate energy and inclusive growth,” said portfolio that aims to deliver returns, whilst
Bond Fund will be available to institutional +ATHERINEû'ARRETT #OXû#%/ûINûAûSTATEMENT supporting those companies who are
investors in Ireland, Belgium, Denmark, 3AMANTHAû,AMBûHEADûOFûlXEDûINCOMEû making a difference,” she said.
&INLANDû,UXEMBOURGû.ORWAYûTHEû will manage the fund, pursuing a long-term The fund is part of the Amundi UCITS
Netherlands, Sweden and the UK. It will be perspective. Fund Partners ICAV, an Ireland-domiciled
CLASSIlEDûASû!RTICLEûûUNDERûTHEû3USTAINABLEû h7EûHAVEûBUILTûAûTEAMûWITHûDIVERSEû UCITS collective investment scheme.
Finance Disclosure Regulation. BACKGROUNDSûANDûEXPERTISEûWITHINûlXEDû GIB Asset Management is a boutique
The fund aims to cater to the needs of income, but who each share a common goal institutional asset manager, operating from
investors with its innovative thematic of delivering returns to our clients, while London and New York. It manages about
approach that was built from scratch. supporting a sustainable future for people US$10bn of assets.
h4HEREûAREûFEWûEXISTINGûOPTIONSûFORûINVESTORSû and planet,” said Lamb. She will be Jihye Hwang
Nature-related risk framework comes under fire

Civil society organisations have written to working groups are focusing on biodiversity Network for Greening the Financial System
the TASKFORCE ON NATURE-RELATED FINANCIAL data, metrics and standards. published a statement in March
DISCLOSURESûTOûEXPRESSûhPROFOUNDûCONCERNvû It is getting ready to release the third of ENCOURAGINGûlNANCIALûAUTHORITIESûTOûINCREASEû
with its work and its potential to facilitate four drafts of its framework in November, their skills and capacity to consider these
corporate greenwashing. which aims to help stop natural capital loss risks more in supervisory activities.
Biodiversity is climbing the agenda of and channel capital towards activities that Central banks in the Netherlands and
investors and regulators as the idea gains support biodiversity. The second draft was France have already tried to measure the
TRACTIONûTHATûNATURE RELATEDûlNANCIALûRISKSû published in June. EXPOSUREûOFûTHEIRûlNANCIALûINSTITUTIONSûTOû
including biodiversity loss and ecosystem The open letter said putting global biodiversity loss and found that 36% and 42%
degradation, could have material corporations in charge of writing the RESPECTIVELYûOFûTHEIRûlNANCIALûINSTITUTIONSû
IMPLICATIONSûFORûlNANCIALûSTABILITYû template for future business regulations investments depend heavily on one or more
TNFD is a voluntary initiative and is COULDûPOSEûSIGNIlCANTûCONmICTSûOFûINTERESTû ecosystem and that loss of biodiversity
developing a framework for how businesses and will not bring much-needed would disrupt business processes and lead to
should self-report on their nature-related independence. lNANCIALûLOSSESû
RISKSû)TûHASûûMEMBERSûFROMûlNANCIALû )TûSAIDû4.&$ûISûhCREATINGûAûFRAMEWORKûTHATû 30ûEXPECTSûTHEûASSESSMENTûOFûNATURE RELATEDû
institutions, corporates and market service supports businesses as usual to make risks to be incorporated into forward-looking
providers that manage more than misleading claims and become a potential scenario analysis, similar to climate change in
US$19.4trn in assets. source for corporate greenwashing.” the future, and banks and investors are
The open letter by the 48 civil society The main criticisms of TNFD’s framework working to integrate biodiversity into
organisations and networks with more than and proposal are that it would not require a SUSTAINABLEûlNANCEûTOûHELPûTOûSTOPûTHEûDECLINEû
220 members listed their concerns and said business to report on its biodiversity of biodiversity and foster its regeneration, but
THEûFRAMEWORKûhFAILSûTOûUSEFULLYûCONTRIBUTEû impacts, risks and negative impacts on this work is still at an early stage.
to addressing the nature crisis”. human rights, the transparency of supply h0ROGRESSûONûTHISûFRONTûWOULDûREQUIREû
TNFD’s members represent sectors with and investment chains, its complaints or increased biodiversity-related data and
the largest impact and dependence on grievances or lobbying activities. disclosure, which is currently even less
nature, including agribusiness, the blue 4HEûlNANCIALûIMPACTûANDûSYSTEMICûRISKSû advanced than climate-related disclosure,”
economy, food and beverage, mining, arising from biodiversity loss are attracting S&P said.
construction and infrastructure, and its increasing regulatory attention. The Tessa Walsh
Highlight your success with reprints from IFR

Contact:
Europe, Africa & USA: Leonie Welss, leonie.welss@lseg.com
Asia & Middle East: Shahid Hamid, shahid.hamid@lseg.com

BONDS
SSAR 21 Corporates 23 FIG 26 High-Yield 30 Structured Finance 32
FRONT STORY UK
£560bn of linkers cast shadow

over Gilt market
High linker stock costly for DMO
Bank of England added these securities to its emergency purchases last week
An embattled Bank of England was forced to INûTHEûlSCALûSTATEMENTû3OûWHILEûTHEûINTERESTû FOCUSING THE MIND
step into the Gilt market with an expanded cost on the stock of Gilts and the small stock Still, despite the mounting cost of servicing
emergency asset purchase programme last of T-bills was going up a bit, the cost of THATûINmATION LINKEDûDEBTûPILEûTHEREûISûAû
week, adding linkers to the mix, a part of servicing the index-linked component was more positive angle. “It also focuses the
the market that has come under investors’ going up a lot, tens of billions in quite short POLICYMAKERSvûSAIDû:AHNûh)FûTHEYûALLOWû
scrutiny given the UNITED KINGDOM‘s large ORDERvûSAIDû#UNNINGHAM INmATIONûTOûREMAINûHIGHûFORûTOOûLONGûITûCOSTSû
stock of debt in the format. “What has helped in that regard is that a lot. That’s always been the argument to
Gilts have been gripped by unprecedented those are RPI-linked, they pay interest on have a larger linker basket because it means
volatility since the end of last month HEADLINEûINmATIONû3OûGETTINGûHEADLINEû YOUûHAVEûTOûKEEPûINmATIONûUNDERûCONTROLv
following the government’s mini-budget, INmATIONûDOWNûFROMûWHATûWASûGOINGû;TOWARDS=û When the case was made in the UK for
forcing the BoE to intervene. ûTOûûISûHELPFULvûHEûSAIDûh)TûWOULDûHAVEû introducing linkers, this was indeed one of the
4HEûCENTRALûBANKûWHICHûHADûlRSTûTARGETEDû been more expensive had they not done that, reasons outlined by the Treasury for having
conventional Gilts in a bid to help LDI funds BUTûYOUûSTILLûHAVEûTHEûCOREûINmATIONûPRESSUREû them. “Far from encouraging a government to
address risks to their resilience from running quite high and while it will come spend, indexed borrowing imposes discipline
extreme moves at the long end of the curve, DOWNûITûWILLûTAKEûTIMEûTOûCOMEûDOWNv in that it becomes less easy for a government
said it would include linkers following a $AVIDû:AHNûHEADûOFû%UROPEANûlXEDû TOûINmATEûASûAûWAYûOFûRESOLVINGûIMMEDIATEû
SIGNIlCANTûREPRICINGûANDûTOûAVOIDûTHEû income at Franklin Templeton, agreed. “It DIFlCULTIESvûITûSAIDûINû
PROSPECTûOFûSELF REINFORCINGûhlREûSALEvû will make debt more expensive but they have Ravin Seeneevassen, senior portfolio
dynamics that posed a material risk to the BENElTEDûFROMûLOWERûCOSTûPREVIOUSLYvûHEû manager at AllianzGI, said that the cost of
5+SûlNANCIALûSTABILITY said. “The UK does have a large percentage in SERVICINGûINmATION LINKEDûDEBTûWASûGOINGûUPû
This helped stabilise the market to some INmATION LINKEDûCOMPAREDûTOûMANYûOTHERû and that this was one of the arguments for
extent and a keenly watched auction by the developed countries, which a lot of pension having some sort of capping mechanism in
DMO of the 0.125% March 2051 linker last funds use for asset liability matching so TERMSûOFûGASû;AND=ûENERGYûPRICES
Tuesday – the day the BoE announced it was HIGHERûINmATIONûWILLûPUSHûUPûTHEûCOSTv h(OWEVERûWEûSHOULDûNOTûVIEWûLINKERû
expanding its emergency purchases to Germany, for example, has €76bn in the SERVICINGûCOSTûONûITSûOWNvûHEûSAIDûh)NûMANYû
include linkers – was amply covered with a FORMATûFROMûlVEûLINESû)NûûISSUANCEûWASû developed countries the past year has seen
2.75 bid-to-cover ratio. Still, it came at €7.7bn, or a 1.6% share of annual supply for debt dynamics – debt-to-GDP metrics –
1.551%, the highest real yield for the DMO all federal securities. The UK has 32 bonds improve despite the announcement of
since 2008, reported Reuters. outstanding. PREVIOUSLYû@UNEXPECTEDûlSCALûMEASURESû
For some investors, the scale of the simply on the back of an accelerating
INmATION LINKEDû5+ûDEBTûISûAûSOURCEûOFû denominator: nominal GDP. So despite
OFF THE HIGH
CONCERNûh7ITHûINmATIONûTHEûNOMINALûPARTû THE YIELD ON THE UK’S 1.25% MARCH 2051 RISINGûYIELDSû;ANDûINmATION=ûINCREASINGûDEBTû
of the Gilt issuance isn’t really the INFLATION-LINKED BOND servicing cost, sovereign countries will not
PROBLEMvûSAIDû(OWARDû#UNNINGHAMûlXEDû % BEûWORSEûOFFûINûTHEûNEARûORûMEDIUMûTERMv
2.5
income portfolio manager at Newton (EûSAIDûHEûDIDûNOTûEXPECTûAûSTRUCTURALû
)NVESTMENTû-ANAGEMENTûh)TSûTHEûINmATION 2.0 change in the pattern of issuance, adding
linked part, the £560bn of index-linked debt 1.5 that linker supply had already decreased
THATûYOUûCANTûINmATEûAWAYûYOUûCANTûLETûITû SINCEûTHEûSTARTûOFûTHEû#0)20)ûREFORMû
1.0
ADJUSTûINûREALûTERMSv consultation in 2018, from over 20% before
(EûSAIDûITûWASûINTERESTINGûTOûSEEûHOWûLITTLEû 0.5 then to below 15% of total issuance
linker issuance the DMO had added to its 0.0 afterwards.
updated remit, calling it “effectively “We would expect linker issuance to
−0.5
NOTHINGv migrate towards that 20% range over the
The £1.5bn increase takes planned linker −1.0 coming years. In addition, issuance of
supply up to £21.2bn for the 2022/2023 −1.5 INmATION LINKEDûSECURITIESûISûONEûKEYûAVENUEû
lSCALûYEARûAGAINSTûAûTOTALûREMITûTHATûHASû via which authorities establish their
−2.0
grown by some £72.4bn to £234.1bn. INmATIONûlGHTINGûCREDENTIALSû(ENCEûWHYû)û
“I think that’s because they’ve realised −2.5 do not expect to hear of any unease about
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
the cost of servicing that index-linked debt 2022 SERVICINGûCOSTûFROMûTHEû$-/v
we already have has become a visible item Source: Markit/Refinitiv Helene Durand

WEEK IN NUMBERS
Green debut smashes Swiss records
Sovereign gets big response to enable tight pricing 4.07%
THE YIELD ON 10-YEAR TREASURIES
SWITZERLAND’s debut green bond emerged )TûSETûTHEûDEALSûCOUPONû ûANDûMATURITYû IN THE AFTERMATH OF LAST
triumphantly at a near-record greenium /CTOBERû ûONû4UESDAYûBEFOREûTHEû THURSDAY’S STRONGER THAN
AFTERûATTRACTINGûNEARLYû3&RBNû53M ûOFû auction. When announced the coupon was EXPECTED US INFLATION PRINT.
demand. The SFr766m 16-year marked close to the mid-market yield on the June IT WAS THE HIGHEST YIELD ON THE
Berne’s biggest issue in a decade and came 2037 15-year benchmark, which had spiked BENCHMARK SINCE 2008
in half as large again as its previous biggest up from around 1% over the previous week. %
this year. At the above-par issue price, the green 4.5
4.0
h7EûAREûPLEASEDûWITHûTHEûRESULTûOFûOURûlRSTû bond carried a launch yield of 1.465%. Swiss 3.5
GREENûBONDûAUCTIONvûSAIDûANûOFlCIALûATûTHEû franc players put its greenium at up to 4bp 3.0
2.5
Federal Finance Administration. “This is a over the interpolated yield curve.
2.0
good result for us, especially considering the Only Denmark’s green debut in January 1.5
VOLATILEûBACKDROPûOFûTHEûLASTûFEWûDAYSv has bettered this level. Switzerland’s fellow 1.0
0.5
Demand at Wednesday’s auction totalled Triple A issued its November 2031 green 0
2/1/08
2/1/09
2/1/10
2/1/11
2/1/12
2/1/13
2/1/14
2/1/15
2/1/16
2/1/17
2/1/18
2/1/19
2/1/20
2/1/21
2/1/22
3&RMû4HISûINCLUDEDûJUSTûUNDERû bond at a yield of 0.14%. This was 5bp
SFr300m of non-competitive bids that the through its conventional twin.
FFA allocated at the issue price of 100.50. )NûTHEûABSENCEûOFûAû#ONFEDERATIONûTWINûOFû Source: Refinitiv
The outcome met the Triple A borrower’s IDENTICALûTENORûANDûCOUPONûTHEû&&!ûOFlCIALû
hopes for greater participation than usual in would say only that pricing on its green
the green bond. The volume of bids
REPRESENTEDûhAûHIGHûAMOUNTûFORûUSvûTHEû
OFlCIALûSAID
DEBUTûWASûhSOLIDv
The sovereign opted for the shortest
maturity available to it for the deal. This
4.21%
THE YIELD ON 10-YEAR GILTS LAST
The sovereign’s previous demand highs REmECTSûTHEû&&!SûAPPROACHûOFûHAVINGûONLYû THURSDAY AS RUMOURS SWIRLED
this year were SFr775m in July and SFr650m ONEû#ONFEDERATIONûBONDûOUTSTANDINGûAûYEARû ABOUT THE UK GOVERNMENT’S
in September. These were for the May 2058 All nearer years were already taken. INTENTIONS OVER ITS MINI-BUDGET
and June 2045 benchmarks, respectively. The strength of Switzerland’s environmental %
5.0
It did achieve SFr1bn-plus of bids in June commitments and legislation may have been a
4.5
2021 and December 2016, though the last factor in the deal’s take-up. The sovereign’s
4.0
time it issued in a size greater than SFr766m green bond framework references the
3.5
was all the way back in November 2012. European Union’s taxonomy of sustainable
3.0
Then nearly SFr2bn of bids led it to sell activities, though it does not claim alignment
2.5
SFr836m of the April 2042 line. since Switzerland is not an EU member. But it 2.0
Until now the SFr510m of the June 2045 embeds domestic standards that are more 1.5
1/6/22
1/7/22
1/9/22
1/10/22
1/8/22
that it issued last month had ranked as its stringent than the EU’s in some cases.
largest single deal this year. The framework is also notable for its high
proportion of spending on biodiversity, an Source: Refinitiv
MARKETING MUSCLE increasing focus for many ESG investors.
Switzerland cleared the decks for the new Including sustainable agriculture and
issue. The FFA usually auctions two
#ONFEDERATIONûBONDSûATûAûTIMEûANDû
sometimes three. But it offered no
landscape management, this area accounts
for as much as 20% of eligible expenditures. 2
THE NUMBER OF UK-RELATED
conventional bonds as part of Wednesday’s SFr1.2bn TO GO HIGH-YIELD ISSUERS RAISING FUNDS
offering. Switzerland will retain SFr300m of the green LAST WEEK, THOUGH BOTH IN THE US
“It is important to us that market bond for future market operations. This DOLLAR MARKET
PARTICIPANTSûFOCUSûONûTHEûGREENûBONDvûTHEû hOWNûTRANCHESvûSTRATEGYûISûTHEû&&!SûUSUALû
OFlCIALûSAIDûLASTûWEEKûBEFOREûTHEûAUCTION approach to new issues, as well as some taps.
It also held a global investor call and an For example, it retained SFr300m each of
investor roundtable in Berne on Tuesday as
part of its marketing effort. This included
the seasoned June 2064 and June 2045
benchmarks in its June and September
€26bn
THE DEMAND THE EU GOT FOR ITS
one-on-one meetings too. International auctions, respectively. €6bn 20-YEAR TRANCHE LAST WEEK
appetite for these was strong despite limited “If needed, proprietary holdings can be AS PART OF A DUAL-TRANCHE OFFERING
OWNERSHIPûOFû#ONFEDERATIONûBONDSûOUTSIDEû sold directly on the market between the ON TUESDAY
Switzerland. ORDINARYûAUCTIONûDATESvûTHEûOFlCIALûSAID
Foreign buyers held some 17% of This approach could help Switzerland
outstandings last year, though their share reach its SFr6bn 2022 funding target. It has
has been as high as 31% in recent years.
The sovereign did not give preferential
more than SFr1.2bn still to source from two
scheduled auctions remaining this year.
€5.9bn
THE DEMAND THAT GERMANY GOT
allocations to dedicated ESG investors, Previous auctions since January have raised FOR ITS €4bn AUGUST 2053 TRADE
unlike some top-rated peers such as the between SFr425m and SFr650m across their LAST TUESDAY, AS INVESTORS SHOWED
Netherlands. “We treat every investor the multiple tranches, according to FFA data. THEIR PREFERENCE FOR THE EU’S
SAMEvûTHEûOFlCIALûSAID Julian Lewis LONGER-DATED BOND

BONDS SSAR
priced the trade at that very level, having õMûTHEûSMALLESTûBOOKûFORûAû#$#ûEUROûISSUEû

got more than €1.3bn orders (excluding lead in the past four years, according to IFR data.
SSAR INTEREST û The fact that this trade was issued off a new
For the syndicate banker, the 10bp–15bp AFD sustainability framework that is aligned with EU
conceded was reminiscent of the Flemish taxonomy was helpful. It attracted a substantial
EUROS #OMMUNITYSûRECENTûõMû YEARûSUSTAINABLEû number of real money accounts with ESG
issue. “We saw exactly the same pattern for the portfolios or at least ESG strategies in place.
FRENCH AGENCIES GET MODEST &LEMISHû#OMMUNITYû YEARûLASTûWEEKû)TûGOTû #$#SûûLONG TERMûFUNDINGûTARGETû
TRACTION DEMANDûBUTûNOTûTHATûMUCHû;OVERûõBN=ûANDû stands at around €3bn-equivalent. With this
even then, they had to pay 10bp at least for the lVE YEARûTRANSACTIONûNOWûCOMPLETEDû#$#û
French agencies AGENCE FRANCAISE DE NEWûISSUEûPREMIUMvûHEûSAID has met €2.3bn of its funding needs and may
DEVELOPPEMENT and CAISSE DES DEPOTS ET CDC targeted the short end with a €500m raise the remaining €700m through a
CONSIGNATIONS drew lukewarm demand for lVE YEARûSUSTAINABILITYûBONDûFORûITSûANNUALû potential Swiss franc benchmark debt
their sustainable deals on Wednesday issuance in the euro market. issuance as well as private placements.
despite sporting optically big spreads over (ARDûTOûNAVIGATEh7EûAREûPLEASEDûWITHûTHEû
the French sovereign. CONlDENCEûINVESTORSûSHOWEDûINûTHEûTRADEûANDû ALL INTERNATIONAL GREEN BONDS
)TûISûNOTûTHEûlRSTûTIMEûTHATû&RENCHû the quality of the order book we got, BOOKRUNNERS: 1/1/2022 TO DATE
agencies have come unstuck in primary this considering this is not an easy market to Managing No of Total Share
year and struggled to drum up large order NAVIGATEvûAûPERSONûCLOSEûTOûTHEûTRADEûSAIDûh7Eû bank or group issues US$(m) (%)
books and the market is just not favourable are not in the same universe as with previous 1 Bank of America 78 17,176.68 7.2
to SSAs, which price versus their #$#ûTRADESûWHENûLIQUIDITYûWASûABUNDANTûANDû 2 BNP Paribas 85 15,271.12 6.4
government curve and not versus swaps at THEû%#"ûPROVIDEDûCOMFORTûTOûINVESTORSûONûTHEû 3 Credit Agricole 83 15,115.08 6.3
present, according to a syndicate banker. secondary market. And on top of that we have 4 Citigroup 83 13,974.33 5.8
“Nothing against France but it currently a geopolitical situation that is bringing a lot of 5 JP Morgan 70 13,414.42 5.6
looks like with such a performance of the VOLATILITYûTOûTHEûMARKETv 6 Deutsche Bank 55 10,893.00 4.5
;&RENCH=ûGOVERNMENTûCURVEûTHOSEûKINDSûOFû Credit Agricole, JP Morgan, La Banque Postale, 7 HSBC 64 10,013.71 4.2
agencies are not that interesting any more. Natixis, NatWest and Societe Generale began 8 Barclays 45 9,397.51 3.9
The spread comparison to German SSAs and marketing the no-grow trade at the 58bp 9 Goldman Sachs 51 7,723.81 3.2
to other SSAs would just offer a better area over interpolated February 2027 and 10 NatWest Markets 26 7,407.95 3.1
pick-up versus their government curves at February 2028 OATs. Total 340 240,211.44
THEûFRONTûENDvûHEûSAIDû(EûADDEDûTHATûFORû 4HEûLEADSûTIGHTENEDûTHEûlNALûSPREADûBYûBPû Excludes social bonds and mixed use of proceeds.
French agencies to secure better outcomes, to 57bp with books closing in excess of Source: Refinitiv SDC code: JG1
THEYûWOULDûNEEDûTOûGOûLONGERûTHANûTHEûlVE
ALL INTERNATIONAL BONDS (ALL CURRENCIES) ALL BONDS IN EUROS
year and long 10-year tenors on offer on
BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE
Tuesday.
Managing No of Total Share Managing No of Total Share
h!NOTHERûFACTORû;PLAYINGûAGAINSTû&RENCHû
bank or group issues US$(m) (%) bank or group issues €(m) (%)
AGENCIES=ûISûTHATûYOUûHAVEûCOVEREDûBONDSûOUTû
1 JP Morgan 858 260,131.14 8.6 1 BNP Paribas 309 82,888.66 7.8
of France that offer a better relative value;
2 Bank of America 723 222,662.74 7.3 2 JP Morgan 239 71,758.50 6.7
they are better rated and their pick-up –
3 Citigroup 714 213,736.98 7.1 3 Deutsche Bank 230 63,169.79 5.9
because they price versus swaps – is more
4 Goldman Sachs 542 172,851.32 5.7 4 Credit Agricole 237 62,358.29 5.9
INTERESTINGûTHANûBUYINGûFORûEXAMPLEû#ADESû
5 Barclays 632 159,451.15 5.3 5 Barclays 191 55,409.04 5.2
ORûANYTHINGûELSEvûHEûSAID
6 Morgan Stanley 518 138,100.44 4.6 6 Societe Generale 217 53,882.98 5.1
AFD was unable to move pricing on its
7 BNP Paribas 565 136,306.99 4.5 7 HSBC 209 51,019.75 4.8
€1.2bn February 2033 sustainable bond
8 HSBC 564 130,357.84 4.3 8 Citigroup 173 48,481.14 4.6
despite offering a double-digit new issue
9 Deutsche Bank 529 129,556.64 4.3 9 Bank of America 148 44,708.85 4.2
premium.
10 Credit Agricole 431 90,739.27 3.0 10 UniCredit 197 43,383.91 4.1
Commerzbank, Credit Agricole, Morgan
Total 3,999 3,031,502.68 Total 1,201 1,065,182.02
Stanley, NatWest, and Societe Generale opened
Including Euro, foreign, global issues. Excluding equity-related debt, Including Euro-preferreds. Excluding equity-related debt,
books at the 55bp area over interpolated US Global ABS/MBS. US Global ABS/MBS.
November 2032 and May 2034 OATs and Source: Refinitiv SDC code: J1 Source: Refinitiv SDC code: N1
EUROPEAN SOVEREIGN BOND AUCTION RESULTS WEEK ENDING OCTOBER 14 2022

Pricing date Issuer Size Coupon (%) Maturity Average Yield (%) Bid-to-cover
Oct 11 2022 Netherlands €2.1bn 0.000 Jan 15 2029 2.403 –
Oct 11 2022 UK (i) £900m 0.125 Mar 22 2051 1.551 2.75
Oct 11 2022 Germany €4.3725bn 0.400 Sep 13 2024 1.910 1.30
Oct 12 2022 UK £3.5bn 4.125 Jan 29 2027 4.800 2.08
Oct 12 2022 Germany €3.338bn 1.700 Aug 15 2032 2.330 1.20
Oct 12 2022 Portugal €349m 2.875 Oct 15 2025 2.087 3.01
Oct 12 2022 Portugal €651m 0.300 Oct 17 2031 3.230 1.79
Oct 13 2022 Italy €3.75bn 3.500 Jan 15 2026 3.570 1.50
Oct 13 2022 Italy €2.75bn 2.800 Jun 15 2029 4.250 1.45
Oct 13 2022 Italy €1bn 3.250 Mar 1 2038 4.820 1.58
Oct 13 2022 Italy €1.25bn 5.000 Aug 1 2039 4.780 1.52
Source: IFR

Market participants were of the view that The supranational put out an RFP on
!&$ûANDû#$#ûDIDûNOTûOVERSHADOWûEACHû Wednesday. The resulting issue is likely NON-CORE CURRENCIES
other, the choice of different maturities GOINGûTOûlLLûTHEûLASTûõBNûITûHASûLEFTûTOûFUNDû
helping. in 2022. Two bankers told IFR they VICTORIA OPENS 2036 LINE
“It’s always a bit challenging bringing understood the RFP was for euro funding,
SIMILARûCREDITSû;TOûMARKETûONûTHEûSAMEûDAY=û with a third saying it would make more TREASURY CORPORATION OF VICTORIA, rated Aa2/
!LTHOUGHûTHEYûAREûATûDIFFERENTûMATURITIESvû sense for the supranational to issue in the !!û-OODYS30 ûRAISEDû!BNû
ONEû$#-ûBANKERûSAID single currency than dollars. 53BN ûFROMûAûSYNDICATEDûSALEûOFûNEWû
Further agency supply is on the cards for The ESM’s lack of a mainstream 4.75% September 15 2036 benchmark
the week ahead, with FMO, the Dutch following in the US – compared with other, bonds via joint lead managers CBA, Deutsche
Development Bank, eyeing a similar format more frequent SSAs in the market – makes Bank, NAB and UBS.
TOû#$#SûCitigroup, Credit Agricole CIB, HSBC dollar issuance more of an uphill task than The bond priced on Tuesday at
and Rabobank will hold investor calls on in its home currency, one of the bankers ûFORûAûYIELDûOFûûWITHINû
Monday with the view to issuing a €500m said, especially in such volatile conditions. BPnBPûGUIDANCEûATû%&0û YEARû
NO GROWûlVE YEARûSUSTAINABILITYû2EGû3û h4HEYREûNOTûAûFREQUENTûISSUERûINû;THEû53û FUTURES ûPLUSûBPûANDûBPûWIDEû
transaction. Proceeds have been earmarked DOLLARûMARKET=ûnûTHEYREûNOTûASûFAMOUSûINû OFûTHEû!PRILûû!#'"
for green and social projects aimed at this market as other issuers, so they have The deal was underpinned by elevated
reducing inequality. TOûPAYûUPûMOREvûHEûSAIDûADDINGûTHATûTHEû bank balance sheet demand, a direct
cross-currency swap also makes the single consequence of the Australian Prudential
ESM SOUNDS OUT EUROS IN BREAK currency a more alluring prospect than Regulatory Authority’s decision to phase
FROM DOLLAR PATTERN dollar issuance when looking at funding out the Reserve Bank of Australia’s
costs. committed liquidity facility by the end of
The EUROPEAN STABILITY MECHANISM appears to be Market depth and steeper yield curves in 2022.
sticking close to home by once more sounding dollars means benchmarks there rarely 4HEûREMOVALûOFûTHEû#,&ûLEAVESûSEMI
OUTûEUROûDEMANDûFORûITSûNEXTûANDûlNALû VENTUREûBEYONDûTHEûlVE YEARûMARKûFORû government paper as the highest yielding
benchmark of 2022, bankers have reported. SSAs, while the ESM’s apparent maturity of the few remaining eligible assets
Another euro trade would mark a break from needs point to a transaction in the single (sovereign bonds, agency bonds and cash
the issuer’s well-established pattern of at least currency. HELDûATûTHEû2"! ûTHATûBANKSûCANûHOLDûTOû
one US dollar appearance a year. The ESM usually funds via a mix of short withstand 30 days of severe liquidity stress
and longer prints. The only year the ESM in order to meet Basel III rules.
ALL US DOLLAR FIXED-RATE GLOBALS has not gone as far or further than the 10- 4HOUGHûTHEYûPREFERûmOATING RATEûNOTESû
BOOKRUNNERS: 1/1/2022 TO DATE year mark was 2014, IFR numbers show, which best match their assets and
Managing No of Total Share when a seven-year was its longest liabilities, banks picked up 58% of the new
bank or group issues US$(m) (%) benchmark. This year has not seen the lXED RATEûOFFERINGûWHILEûASSETûMANAGERSû
1 Bank of America 203 63,548.78 10.9 ESM print even as far as seven years, TOOKûûTRADINGûDESKSûûOFlCIALû
2 JP Morgan 185 59,199.41 10.1 suggesting the new print may add some institutions 3% and hedge funds 2%, to the
3 Citigroup 165 57,823.53 9.9 duration to its 2022 debt offerings. nearest percent.
4 Goldman Sachs 104 36,487.65 6.2 A seven-to 10-year deal looks likely, the !USTRALIANûINVESTORSûWEREûALLOTTEDûû
5 Morgan Stanley 103 35,770.08 6.1 lRSTûBANKERûSAIDû!ûSECONDûBANKERûAGREEDû Asia 3%, the UK 2%, the Americas 2% and
6 Wells Fargo 128 31,404.99 5.4 that those tenors make sense. But sizeable Europe 1%.
7 Barclays 87 30,908.67 5.3 seven-year euro deals in the last three In comparison, bank balance sheets
8 Deutsche Bank 60 24,143.58 4.1 weeks from the European Union and KfW, BOUGHTûûOFû4#6Sû!BNû3EPTEMBERû
9 RBC 78 22,829.54 3.9 which took €5bn and €4bn from that point 2033 bond sale in April 2021, before APRA
10 TD Securities 65 20,289.46 3.5 respectively, could mean shallower ANNOUNCEDûTHEûWINDINGûDOWNûOFûTHEû#,&û
Total 353 585,203.96 INTERESTûATûTHEûSEVEN YEARûMARKûTHEûlRSTû
Excluding equity-related debt, ABS/MBS.
BANKERûSAIDûCALLINGûTHEûTENORûhSATURATEDv AIRSERVICES AUSTRALIA TO
Source: Refinitiv SDC code: O5 MEET INVESTORS
ALL INTERNATIONAL US$ BONDS ALL SOVEREIGN BONDS IN EUROS

AIRSERVICES AUSTRALIA has mandated CBA and
Westpac to arrange investor meetings in
Managing No of Total Share Managing No of Total Share Australia and Asia, starting October 18, for
bank or group issues US$(m) (%) bank or group issues €(m) (%)
a potential Australian dollar six-year and
1 JP Morgan 536 175,902.16 10.6 1 JP Morgan 34 21,381.76 12.7
10-year senior unsecured bond offering.
2 Bank of America 524 163,529.76 9.9 2 BNP Paribas 24 15,572.24 9.3
The government-owned agency, rated
3 Citigroup 506 155,888.62 9.4 3 Deutsche Bank 20 14,132.69 8.4
AAA by S&P, is responsible for airspace
4 Goldman Sachs 370 124,086.41 7.5 4 Citigroup 22 12,659.57 7.5
management, aeronautical information,
5 Morgan Stanley 349 98,913.07 6.0 5 Barclays 21 12,608.89 7.5
aviation communications, radio navigation
6 Barclays 367 85,841.91 5.2 6 Credit Agricole 16 12,134.62 7.2
AIDSûANDûAVIATIONûRESCUEûlRElGHTINGû
7 Wells Fargo 297 64,408.10 3.9 7 Bank of America 13 9,275.79 5.5
services.
8 HSBC 208 57,001.24 3.4 8 Goldman Sachs 14 7,593.54 4.5
Airservices Australia previously issued
9 Credit Suisse 244 56,646.10 3.4 9 Nomura 9 7,439.58 4.4
A$275m of 10-year senior unsecured MTNs
10 Deutsche Bank 248 54,555.68 3.3 10 Societe Generale 10 7,216.41 4.3
in May 2020 following a A$400m seven
Total 1,783 1,654,645.90 Total 57 168,199.30
and 10-year print in May 2016 and a
Including Euro, foreign and global issues. Excluding equity-related debt, Excluding ABS/MBS.
US Global ABS/MBS.
A$275m seven-year sale in November
Source: Refinitiv SDC code: O1 Source: Refinitiv SDC code: N4 2013.

BONDS CORPORATES
On October 6, the Italian utility printed a #REDIT3IGHTSûSAIDûITûEXPECTEDû'%û(EALTHCAREû

US$1.25bn 10-year senior note at 400bp over to issue the new bonds and carry out the
CORPORATES Treasuries, or a coupon of 7.811%. But in its exchange offer before the end of the year.
June foray into the US dollar bond market, GE has said it plans to wrap up the tax-
Enel had paid 215bp over for a comparable free spin-off of GE’s healthcare division in
US DOLLARS maturity, at a coupon of 5.168%. early 2023. The spin-off was announced in
And in the FIG market, Allied Irish Banks November 2021 as part of a major
US CORPORATES FACE STICKER SHOCK sold on October 6 a US$750m senior four- restructuring intended to leave a more
AS MATURITIES BECKON YEARûNON CALLûTHREEûlXED TO mOATINGûNOTEûATû streamlined parent company focused on its
335bp over Treasuries. But peer Bank of aircraft engine business.
US investment-grade corporates will have to Ireland had printed a similarly structured US
replace upcoming maturities with more dollar offering in mid-September at 265bp
expensive debt thanks to the surge in rates over Treasuries. EUROS
over recent months.
The average coupon on a US investment- GE HEALTHCARE DISCLOSES EURO CORPORATE YIELDS SURGE
grade corporate bond was around 3.7%, SPIN-OFF CAPITAL STRUCTURE TO HIGHEST LEVELS SINCE 2011
ACCORDINGûTOû)#%û"OF!ûINDEXûDATAû)Nû
contrast, the average yield for the overall Industrial conglomerate GENERAL ELECTRIC #REDITûINVESTORSûINCREASINGLYûSEEûCOMPELLINGû
bond index was 5.84% on October 12, up SUBMITTEDûAûREGULATORYûlLINGûONû4UESDAYû opportunities in the high-grade market,
from the August 1 low of 4.33%. that gave further details on the new capital with average yields in the euro corporate
“If you want to borrow money, it’s going structure of its spun-off healthcare business, space surging to levels not seen since
to cost you 200bp more than the debt you set for a public listing next year. November 2011. Still, new issue premiums
have outstanding, so that will take a lot of '%û(EALTHCAREûISûEXPECTEDûTOûFUNNELûAû remain elevated in the primary.
these opportunistic issuers out of the large dividend to the parent company The average yield for euro corporate senior
MARKETPLACEûNOWvûSAIDû4OMû-URPHYûHEADû following the spin-off, which, in turn, would debt shot up to 4.18% on Thursday from 0.73%
OFûINVESTMENT GRADEûCREDITûATû#OLUMBIAû back a cash tender offer for GE’s existing at the start of the year, according to iBoxx. The
Threadneedle. bonds that would help reduce its corporate lGUREûHOVEREDûBELOWûTHEûûMARKûEVENûINû
4HEûPROBLEMûOFûRElNANCINGûDEBTûISûEVENû leverage. March 2020 when the global economy was hit
more acute when issuers consider near-term 4OûlNANCEûTHISûDIVIDENDûTHEûNEWûSPINCOû by the coronavirus pandemic.
maturities, which carry lower coupons than will carry over US$15bn of debt. Around
ALL INV-GRADE US CORPORATE BONDS
the broader index. The average investment- two-thirds of the amount, or US$10.2bn,
BOOKRUNNERS: 1/1/2022 TO DATE
grade coupon for bonds due in 2023 was will come in the form of senior notes and
Managing No of Total Share
2.8%, and 3% for 2024. loans, a chunk of which will be issued
bank or group issues US$(m) (%)
“There is a good amount of debt due in through the public markets. An additional
1 JP Morgan 36 7,101.86 15.6
THEûNEXTûYEARSvûSAIDû-URPHYûTHOUGHûHEû US$5.2bn of the GE’s pension liabilities
2 Barclays 18 3,892.93 8.5
noted the US corporate bond market had will be transferred to the new company.
3 Bank of America 28 3,706.88 8.1
enough depth and capacity to take down the But in addition to the tender offer, the
4 Citigroup 19 3,158.12 6.9
mountain of high-grade maturities. “It conglomerate said it could also conduct an
5 RBC 21 2,972.04 6.5
doesn’t seem so imposing in the context of exchange offer that would have GE’s
6 Wells Fargo 23 2,635.46 5.8
what the investment-grade market does in existing bondholders swap their securities
7 Morgan Stanley 20 2,576.85 5.7
ISSUANCEûEVERYûYEARv for a portion of the bonds issued under the
8 MUFG 10 2,244.29 4.9
Between US$700bn and US$820bn of new healthcare spinco, according to the
9 Goldman Sachs 13 2,006.10 4.4
investment-grade paper is coming due every lLING
10 Societe Generale 7 1,748.27 3.8
YEARûFROMûûTOûûACCORDINGûTOû)#% Such a move would reduce the size of
Total 79 45,570.60
The Federal Reserve’s campaign to control the dividend to the parent company and
Excluding equity-related debt, ABS/MBS, all foreign issues, global issues
INmATIONûTHROUGHûSEVERALûJUMBOûRATEûHIKESûHASû the eventual cash tender offer for GE’s and non corporates.
been the principal reason for higher corporate bonds. Source: Refinitiv SDC code: F6a
borrowing costs. A higher than expected
September print on US consumer prices ALL US INVESTMENT GRADE CORPORATE DEBT ALL CORPORATE BONDS IN EUROS
AFlRMEDûEXPECTATIONSûFORûANOTHERûBPûINCREASEû BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE
from the US central bank in November. Managing No of Total Share Managing No of Total Share
That is presenting a conundrum for bank or group issues US$(m) (%) bank or group issues €(m) (%)
bankers who have sold their clients on the 1 BNP Paribas 109 16,221.71 7.5
1 JP Morgan 348 128,377.64 12.5
prospect of reducing interest-rate expenses, 2 HSBC 74 13,849.15 6.4
2 Bank of America 349 124,716.53 12.1
a key driver of high-grade issuance until the 3 Deutsche Bank 71 13,043.80 6.0
3 Citigroup 291 98,665.50 9.6
middle of this year. 4 Societe Generale 73 11,814.97 5.4
4 Goldman Sachs 197 85,230.17 8.3
“The bad news is there are not many 5 JP Morgan 64 10,925.47 5.0
5 Morgan Stanley 213 70,311.12 6.8
interest-rate saving ideas where you can add 6 Barclays 58 10,464.36 4.8
6 Wells Fargo 202 60,313.07 5.9
VALUEûTOûAûCOMPANYûRIGHTûNOWvûSAIDûAû$#-û 7 UniCredit 64 10,260.52 4.7
7 Barclays 150 45,323.37 4.4
banker. 8 HSBC 91 37,333.14 3.6 8 Bank of America 51 9,966.11 4.6
Enel was an example of how well-heeled, 9 MUFG 126 33,537.29 3.3 9 Citigroup 50 8,723.48 4.0
repeat borrowers that issued bonds at tight 10 RBC 132 29,397.54 2.9 10 Goldman Sachs 48 8,004.14 3.7
spreads a few months ago were now facing a Total 697 1,029,210.08 Total 283 217,418.98
sticker shock in a much less receptive Excluding equity-related debt. FIGs, ABS/MBS.
market. Source: Refinitiv SDC code: F9 Source: Refinitiv SDC code: N8

Corporates scramble to manage hybrid exposure
CORPORATE HYBRIDS Spanish gas company Naturgy to redeem call through cash
Corporate borrowers, faced with unpalatable BALANCING ACT dropping as low as 94 heading into the call
cost of funding on their hybrid bonds, are Naturgy’s decision was seen as positive for announcement, according to Tradeweb.
looking to reduce their overall stack of such bondholders and brought some relief to the “It is worth noting that given [the company’s]
debt, another nail in the coffin for the market, market that has been fretting about extension current leverage, [it] will probably avoid a
which has seen volumes plummet in 2022. risk. downgrade even if [it does] lose that equity
NATURGY said on Thursday that it would “It’s a good signal for the sector as it’s been treatment. I think the motivation for this call
redeem one of its subordinated bonds at 50:50 [as to] whether the company was going to was reducing ongoing interest costs rather than
the first call date in November with cash, call its hybrid,” said Gordon Shannon, portfolio maintaining access to the hybrid market,” said
suggesting its intention to give up on hybrids manager at TwentyFour Asset Management. Shannon before S&P’s announcement.
as a permanent part of its capital structure. “It shows that calls are certainly not impossible
This comes as a handful of companies, such even in this market.” CREATIVE SOLUTIONS
as Merck and Balder, have conducted tender Still, it has ramifications for the rest of the Some bankers expect further liability
offers on their hybrids without a concurrent issuer’s subordinated debt stack given that S&P management activity ahead in this corner of the
new issue. ENGIE is also conducting a tender removes equity credit on all of a company’s market as not just tenders but also exchange
on three tranches of hybrid debt, an offer remaining hybrids, if a borrower chooses to call offers or consent solicitations could take place
that concludes on Wednesday. The French a subordinated bond without replacing it with with companies seeking creative ways to
utility did not follow up with a new offering a new one. The agency does give borrowers a manage their hybrid exposure.
announcement. little bit of wiggle room with redemptions in line Partial buybacks work well for companies
High-grade corporate issuers opting to let with 10% of total hybrids outstanding over a 12- juggling to protect their investment-grade
their stock of hybrid roll off is the latest body month period considered to be immaterial. credit ratings and maintain relationships with
blow to an already moribund euro hybrid “There’s a divide in the sector between issuers bondholders as well as equity investors.
market where sales have dropped more than with big quantitative hybrid curves that will “We expect some companies will look at
52% to €9.9bn versus the same period last want to play by the rules – so would be limited liability management tools such as exchange
year, according to IFR data. to reducing the hybrid stock by S&P’s 10% transactions as we’ve already seen in the FIG
“Many companies will still say they like annual threshold – and issuers with only a few market,” said Damani, citing the most recent
hybrids, but given the new credit environment, outstanding hybrids that may well be prepared trade from Shawbrook Group that launched an
they will reduce the overall amount by looking to upset S&P and lose equity credit in those Additional Tier 1 exchange offer on Monday.
at alternative sources of equity content,” said bonds if they don’t make a huge difference to “Companies are able to provide a new
Kapil Damani, head of capital products at BNP their credit metrics,” said James Sparrow, head instrument that can offer better value than the old
Paribas. of investment grade desk analysts, BNP Paribas bonds and this is also in the interest of the issuer
The euro corporate subordinated bond iBoxx Credit 360. as it can avoid the execution risk of a new issue.”
closed at 7.3% on Thursday, up from 1.8% at Spanish gas company Naturgy has two other Another capital solutions banker said,
the start of the year. outstanding hybrids, a €500m 3.375% perpetual however, that such transactions were essentially
Corporates have used hybrids as a way non-call 2024 and a €500m 2.374% perpetual extending the call date with a bit of premium
of strengthening their balance sheets and non-call 2026, apart from the €500m 4.125% as the economics of the exchange have to be
protecting their credit ratings without diluting perpetual non-call eight hybrids issued in 2014. attractive enough for investors.
their shareholders. Ultra-low rates over the past S&P revised the equity content on all the bonds “It’s only a temporary cure to the extension
decade made these deals particularly attractive. to minimal, although it affirmed the company’s risk,” he said. “Whether a company decides to
“2022 was a relatively light redemption BBB rating. amend terms through a consent solicitation or
year, but looking at the next four years, there’s A financing official at Naturgy told IFR go through an exchange offer – such trades are
around €115bn that needs to be refinanced that the decision was an optimal alternative, happening because there is no alternative to
[in the euro IG corporate hybrid space],” said considering cost efficiency, investor-friendliness prevent a non-call event. It’s an untested market
Damani, adding that corporate treasurers faced and the company’s strong trading and cashflow. yet in the corporate space, so I’m also unsure of
a difficult decision on how to best manage their The cash price of Naturgy’s November hybrids how investors would take it.”
stakeholders. recovered on the day to be touching par after Jihye Hwang
“Whether in sterling, euros or dollars, the SHORT TERMûTECHNICALû;ISSUE=ûWILLûACTûASû The improved investment case, coming
all-in yields are certainly historically very something of a headwind, although on the back of a rising interest rate
high, and will start to look attractive to ultimately we believe that the valuation ENVIRONMENTûWASûREmECTEDûINûEUROûDEALSûINû
investors in the wealth management and ARGUMENTûISûMOREûCOMPELLINGv THEûlRSTûFULLûWEEKûOFû/CTOBERûASûTHEûMARKETû
insurance community, particularly in terms Maria Staeheli, senior portfolio manager window opened up with the tightening of
OFûNEWûISSUESûONûOFFERvûSAIDû)AINû"UCKLEû at Fisch Asset Management, wrote that spreads. Even in the face of Gilts market
head of credit UK, at Aegon Asset investment-grade bonds offer an attractive volatility, euro issuance remained largely
Management. opportunity to choose a defensive unscathed, with 10 borrowers, including
h(OWEVERûONEûHASûTOûTEMPERûTHISûTOûAû INVESTMENTûWITHOUTûOVERLYûSACRIlCINGûYIELDû lNANCIALûANDû%-ûCROSSOVERûNAMESûRAISINGûAû
degree given the extent to which LDI h(IGH QUALITYûGOVERNMENTûBONDSûANDû COMBINEDûõBN
accounts are being forced to build up investment-grade credit have seen their “We can sail through rates volatility and
liquidity in the UK to meet margin calls. This WORST CASEûSCENARIOSûTO DATEvûSHEûSAID MACROûUNCERTAINTYûWITHûAûGOODûBUFFERvûSAIDû

BONDS CORPORATES
Aû$#-ûHEADûh4HEûMOREûSERIOUSûMATTERûISû
that there aren’t many days left for this year,
WHICHûWASûNOTûAûBIGûRElNANCINGûYEARûANDû
that means there’s not much done in terms
Thermo Fisher debuts
of funding, while things to do are piling up
ASûWEûFACEûAûWALLûOFûRElNANCINGûINûû
successfully in yen
Today, we have market access and we can’t
TAKEûTHATûFORûGRANTEDv CORPORATES Rarity of US corporates helps medical equipment firm draw good
Markets volatility over the past couple of demand even at 30 years
weeks has seen euro investment-grade
corporate new issue premiums jump to THERMO FISHER SCIENTIFIC has made a successful Initial price guidance at the start of marketing
BPûVERSUSûBPûSEENûINûTHEûlRSTûHALFûOFû debut in the yen bond market with a ¥110.1bn on Wednesday was 65bp–70bp over Tonar mid-
this year, according to IFR data. (US$747m) six-tranche offering as the rarity of a swaps for the three-year tranche, 75bp–80bp
h;4HE=ûCYCLICALûPREMIUMûISûNOTûATûRECESSIONû US corporate name drew strong demand from for the five-year, 85bp–90bp for the seven-year,
levels and spreads still look compressed, Japanese investors. 90bp–95bp for the 10-year, 100bp–105bp for the
although that depends on what kind of The medical equipment manufacturer, rated 20-year, and 110bp–115bp for the 30-year.
RECESSIONûWEREûEXPECTINGû#ORPORATESû A3/A–/BBB+, initially planned to sell yen bonds Guidance was finalised on Thursday at 70bp,
balance sheets are in relatively good shape in 2018 when it mandated Goldman Sachs 80bp, 90bp, 95bp, 105bp, and 115bp, the wide
but they are likely to weaken as we see and three Japanese banks to arrange investor ends of all the respective initial guidance ranges.
third-quarter earnings that are expected to meetings in Tokyo, but an actual deal did not The company marketed a 15-year tranche at
BEûAFFECTEDûBYûHIGHERûENERGYûPRICESvûSAIDû materialise. 95bp–100bp on Wednesday and then at 100bp
Rochus Baumgartner, head of IG credit at The company persisted and hired Citigroup yesterday, but decided to drop it.
UBS Global Wealth Management. and the same three Japanese arrangers – Bankers on the deal declined to comment
“Market technicals are also weak – why Mizuho, MUFG and SMBC Nikko – to set up on investor statistics, but life insurers are said
would investors return to corporate bonds virtual meetings with Japanese investors in to have bought the long-dated tranches. There
now when they can get similar yields in the September, before making an SEC filing for the were also decent orders from foreign accounts.
SOVEREIGNûSPACEû4HEû%#"ûWILLûALSOûSTARTû deal on Tuesday night with the four banks as As has been the case in the domestic market, the
selling down its asset purchase programme joint bookrunners. 10-year tranche failed to attract strong demand.
ATûSOMEûPOINTûINûTHEûFUTUREv “We saw strong interest from investors even The JGB yield curve has been distorted at the 10-
at the meetings,” said a banker on the deal, who year point because of large bond purchases by
VATTENFALL SECURES SHORT-TERM thought the transaction would be successful the Bank of Japan to cap the yield at 0.25%. As a
LIQUIDITY because yen bonds from US corporates are rare result, market participants are unable to reach a
and the issuer is well recognised in Japan. consensus as to where the fair value is for 10-year
VATTENFALL tapped the euro market on Tuesday Still, some investors were sceptical whether JGBs and have been reluctant to buy corporate
with an unusually short tenor for a utility as it the company would be able to draw more than bonds and even municipal bonds at that tenor.
sought to build a liquidity cushion. ¥100bn of demand given the recent market Even though Thermo Fisher’s 10-year tranche
The €1.65bn triple-tranche offering volatility. was priced relative to Tonar swaps, not JGBs,
included two 18-month tranches – one of “I didn’t expect the size would be bigger than investors’ caution about the 10-year segment
&2.SûTHEûOTHERûOFûlXED RATEûNOTESûnû ¥100bn, but demand for Thermo turned out to be was evident in this deal.
ALONGSIDEûONEûOFûFOUR YEARûlXED RATEû very strong,” a Japanese fund manager said, also The issuer will use the proceeds for general
securities. The Swedish state-owned energy surprised by the fact that the company raised corporate purposes, which may include the
lRMûRATEDû!"""ûWASûTARGETINGûTHEûSAMEû more than ¥30bn in the 30-year tranche in its acquisition of companies, repayment and
money market fund investor base through debut deal. refinancing of debt, capital expenditure or the
the two 18-month note tranches, but The SEC-registered senior unsecured deal repurchase of outstanding equity securities.
wanted to offer a choice to encourage comprised a ¥22.3bn 0.853% three-year tranche, Bankers hope the successful debut will give an
greater interest. a ¥28.9bn 1.054% five-year, a ¥4.7bn 1.279% incentive for the issuer to come back to the yen market.
“There are dedicated pockets of demand seven-year, a ¥6.3bn 1.49% 10-year, a ¥14.6bn “We think Thermo Fisher will become a frequent issuer
for up to three-year tenor bonds, but we’ve 2.069% 20-year, and a ¥33.3bn 2.382% 30-year. in yen like Prologis and Corning,” said the banker.
seen in previous trades with multiple All priced at par. Takahiro Okamoto
tranches, as in the EDF and Enel deals, that
the shorter-end had slightly less bid, while
investors are getting comfortable buying While issuers tend to use private WITHû6ATTENFALLSûNEWûOFFERINGûMARKINGûTHEû
NOTESûATûTHEûLONG ENDvûSAIDûAûLEAD placements when funding for as short as 18 lRSTû MONTHûNOTEûISSUEûFROMûANûENERGYû
EDF’s €3bn three-tranche transaction on MONTHSû6ATTENFALLûWASûABLEûTOûTESTûDEMANDû company, according to IFR data.
October 5, for example, saw the 12-year in the public arena. By doing so, it was able The €650m April 2024 FRN tranche
green notes get 2-1/2 times more orders to complement its funding in the landed at three-month Euribor plus 50bp,
than the conventional long four-year commercial paper and bank loan markets, WHILEûTHEûõMûOFûlXED RATEû!PRILûû
tranche, at €2.55bn compared with €1.05bn. said the banker. bonds came at 50bp over mid-swaps. The
“What investors are closely monitoring The last transaction in the euro €500m of four-year bonds landed at 65bp.
right now is rates volatility and hence investment-grade corporate market with an Initial price thoughts were 75bp area,
there’s so much focus on the wording from 18-month tenor came from Daimler Truck 70bp area and 85bp area, respectively, via
central banks and what the trajectory of the !""" ûINû-ARCHû67ûSUBSIDIARYû4RATONû BNP Paribas, Danske Bank, ING and Societe
global economy is going to be. So there is a "AA""" ûPRINTEDûAû MONTHûmOATERûINû Generale.
BITûMOREûCAUTIONûATûTHEûSHORT ENDvûTHEû May, but bonds with such short tenors are The deal was covered more than two
banker said. RAREûAWAYûFROMûTHEûAUTO lNANCINGûSECTORû TIMESûWITHûlNALûCOMBINEDûORDERSûATûOVERû

€3.6bn. Orders for the 18-month notes came payments in the Nordics. The net effect has &ORûEXAMPLEû#REDIT3IGHTSûSAIDûINûAû
in at more than €1.2bn for the FRNs and BEENûSUBSTANTIALûNETûINmOWSûOFûMARGINûCALLSû Wednesday research note that it expected
MOREûTHANûõBNûFORûTHEûlXED RATEûTRANCHEû according to the roadshow presentation. US$5bn–$10bn of supply to come from the
Demand for the four-year bonds was more 6ATTENFALLûWASûTHEûONLYûHIGH GRADEû big six US banks following their results. JP
than €1.4bn. The issuer paid a concession of corporate issuer in the euro market last Morgan, Wells Fargo, Morgan Stanley and
about 20bp–25bp across all three tranches, week. #ITIGROUPûREPORTEDûRESULTSûONû&RIDAY
according to bankers on and away from the Another wave of post-earnings supply
deal. from the US GSIBs could put further
h)TûWASûAûWELL mAGGEDûDEALûHAVINGûDONEû PRESSUREûONûSPREADSûFORûlNANCIALûSECTORû
roadshows last week and the issuer as well bonds, which have traded about 30bp wider
as investors wanted to move on with the FIG than their corporate peers, according to JP
deal – we’ve interacted with almost a Morgan.
HUNDREDûINVESTORSûSOûITûFELTûRIGHTûTOûGOvûSAIDû “If banks come to market aggressively
a second lead. US DOLLARS OVERûTHEûCOMINGûDAYSûEVENûASûNON lNANCIALSû
6ATTENFALLSûDEALûSHOWSûAûPRUDENTû HAVEûBEENûRELATIVELYûQUIETû;ONûISSUANCE=ûTHISû
approach to managing its balance sheet, said BIG US BANKS’ POST-EARNINGS GAPûISûLIKELYûTOûMOVEûFURTHERûSTILLvûSAIDûTHEû
bankers, even though the company held BOND ISSUANCE COULD TOP US$18bn bank’s analysts on Wednesday.
over €13bn of cash and cash equivalents Many investors have been betting that gap
PLUSûSHORT TERMûINVESTMENTSûINûTHEûlRSTûHALFû The big US banks could come to the high- would eventually narrow once banks started
of the year. The recent swings in gas futures grade bond market with US$18bn–$20bn of to tighten the issuance spigot. But those
have meant that many European energy supply after reporting third-quarter hopes have been repeatedly frustrated this
companies are navigating margin calls to earnings, according to JP Morgan analysts. YEARûASûTHEûLARGEû53ûlRMSûHAVEûSOLDûMOREû
fund hedges. Their elevated forecast for heavy issuance bonds than expected, taking advantage of
6ATTENFALLûISûAûNETûBUYERûOFûGASûANDû from the global systematically important THEIRûmEXIBILITYûTOûRAISEûFUNDINGûINû
electricity in Germany, but a net producer in banks runs against expectations among anticipation of wider spreads and higher
the Nordics. With the higher commodity some market participants that bond interest rates.
prices, the company has received margin issuance from these lenders would tail off “One of the questions most often asked in
payments in Germany but made margin towards the end of the year. recent investor meetings is ‘when will bank
supply slow so my overweight can work?’ –
ALL INVESTMENT-GRADE BONDS IN EUROS ALL CORPORATE BONDS IN STERLING suggesting that the long bank trade is a
BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE CROWDEDûONEvûTHEûANALYSTSûSAID
Managing No of Total Share Managing No of Total Share
bank or group issues €(m) (%) bank or group issues £(m) (%)
1 BNP Paribas 260 75,302.23 8.1 1 Barclays 17 1,959.39 13.4 EUROS
2 JP Morgan 213 67,863.04 7.3 2 HSBC 13 1,503.78 10.3
3 Deutsche Bank 190 55,550.34 6.0 3 NatWest Markets 12 1,155.34 7.9 LBBW STEALS LIMELIGHT WITH TWO-YEAR
4 Credit Agricole 195 54,701.97 5.9 4 Bank of America 10 1,128.04 7.7 COVERED BLOWOUT
5 Barclays 157 50,292.14 5.4 5 Goldman Sachs 9 1,036.06 7.1
6 HSBC 189 48,575.64 5.2 6 RBC 10 971.46 6.7 LBBW stole the limelight on Tuesday with a
7 Societe Generale 184 48,088.94 5.2 7 Deutsche Bank 6 901.81 6.2 €1bn two-year public sector Pfandbrief issue
8 Citigroup 139 43,256.77 4.6 8 BNP Paribas 9 871.42 6.0 THATûWASûMOREûTHANûlVEûTIMESûSUBSCRIBEDû
9 Bank of America 125 40,916.62 4.4 9 JP Morgan 7 769.26 5.3 while longer dated covered bonds by La
10 Goldman Sachs 100 37,405.08 4.0 10 Lloyds Bank 8 750.29 5.1 "ANQUEû0OSTALEûANDû"ELlUSû"ANKûDREWûMOREû
Total 959 930,545.17 Total 38 14,592.38 modest interest.
Excluding ABS/MBS, equity-related debt.
h#OVEREDSûAREûSTILLûWORKINGûANDûWILLû
Source: Refinitiv SDC code: N9 Source: Refinitiv SDC code: N8a continue to work as haven instruments.
(OWûFASTûORûINûWHICHûCONDITIONSûYOUûREACHû
ALL INTERNATIONAL STERLING BONDS ALL SWISS FRANC BONDS INCLUDING THEûlNISHûLINEûDEPENDSûAûBITûONûTHEûNEWû
EXCLUDING SECURITISATIONS SECURITISATIONS ISSUEûPREMIUMû;YOUûOFFER=vûONEûBANKERûSAID
BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE A second banker added that though the
Managing No of Total Share Managing No of Total Share execution risk on a covered bond offering
bank or group issues £(m) (%) bank or group issues SFr(m) (%) remains low, the level of subscription, for
1 NatWest Markets 77 9,454.62 12.4 1 Credit Suisse 110 13,416.35 28.7 most issuers, will not reach some of the
2 HSBC 78 9,328.92 12.2 2 UBS 85 11,712.41 25.0 heights seen earlier in the year. “LBBW is
3 Barclays 67 9,110.56 11.9 3 ZKB 44 7,246.65 15.5 DIFFERENTûBECAUSEûOFûTHEûUNUSUALûTENORvûHEû
4 RBC 45 6,070.95 8.0 4 Verband Schweiz 14 4,815.41 10.3 said.
5 Lloyds Bank 36 4,490.91 5.9 5 Raiffeisen Schweiz 35 3,500.08 7.5 LBBW picked a tenor that has been rarely
6 Bank of America 34 4,331.19 5.7 6 Deutsche Bank 19 2,293.22 4.9 seen in recent years; typically in the euro
7 Credit Suisse 18 4,084.73 5.4 7 BNP Paribas 16 1,613.04 3.4 covered bond market for private
8 Deutsche Bank 23 3,181.69 4.2 8 Commerzbank 10 890.12 1.9 placements.
9 TD Securities 23 2,944.29 3.9 9 Basler KB 5 307.48 0.7 “The tenor was picked because of the
10 Citigroup 16 2,692.54 3.5 10 Basellandschaftliche 5 232.06 0.5 COLLATERALûANDûALSOûTHEû!,-ûPERSPECTIVEvû
Total 198 76,251.53 Total 191 46,777.13 said a third banker. “It’s not that we go that
Including preferreds. Excluding equity-related debt. Including preferreds. Excluding equity-related debt. defensive because we believe that the
Source: Refinitiv SDC code: K05a Source: Refinitiv SDC code: K06c MARKETûFORûFOUR YEARSûORûlVE YEARSûDOESûNOTû

BONDS FIG
work, that’s for sure not the case. We can do CAFFIL COVERED IN FOCUS AFTER bankers indicated a new issue concession of
such short-dated maturities and why not test BDF ABSENCE 5bp–7bp.
THEûWATERSûFORûAû;DEALûIN=ûDEEPLYûNEGATIVEû The leads set pricing at 13bp, on the back
SPREADûTERRITORYûANDûAûGOODûSIZEv #AISSEû&RANCAISEûDEû&INANCEMENTû,OCALû OFûORDERSûPASSINGûTHEûõBNûMARKû4HEûlNALû
Bankers said the best reference point for (CAFFIL ûLANDEDûANûASSUREDûõBNûLONGûSIX YEARû tally stood at €1.5bn, including €45m of lead
THEûNEWûISSUEûWASûTHEREFOREû"ERLINû(YPSû covered on Monday in spite of the surprise interest.
€1bn 1.25% August 2025 green Pfandbrief. absence of an order from the French central #OMPARINGûTHEûRESULTSûBANKERSûSAIDûTHEû
That deal was quoted at minus 23bp, mid, bank. lack of an order from the Banque de France
pre-announcement on Monday, but widened #AFlLSûDEALûDREWûTHEûATTENTIONûOFû DIDûNOTûAPPEARûTOûHAVEûHADûAûSIGNIlCANTû
to around minus 18bp by midday, according market participants after it became IMPACTûONû#AFlLSûTRADEû
to Tradeweb. apparent that the leads had not received La Banque Postale’s distribution statistics
h4HEûMAINûCOMPARABLEûISûTHEûTRADEû"((û an order from the Banque de France, showed a 34% allocation to French investors
DIDûTHISûYEARûINû!UGUSTû;4HISû,""7ûTRADE=ûISû according to sources. and a 27% allocation to central banks and
a bit shorter and not green, but we are While net purchases under the OFlCIALûINSTITUTIONS
CERTAINLYûLOOKINGûFORûõBNvûTHEûTHIRDûBANKERû %UROPEANû#ENTRALû"ANKSûPURCHASEû Meanwhile, French accounts took a 28%
SAIDûh"((ûISûTRADINGûATûMINUSûBPûONûTHEû programme have ended, eligible new SHAREûOFû#AFlLSûTRADEûWHILEûCENTRALûBANKSû
mid; I do not think we will land that tight. ISSUESûHAVEûSTILLûTYPICALLYûBENElTEDûFROMûANû ANDûOFlCIALûINSTITUTIONSûTOOKû
We will leave a bit of cushion, of new issue order of around 20% of the deal’s size from !ûBANKERûSAIDûTHATû#AFlLSûDEALûSERVEDûASûAû
CONCESSIONûFORûINVESTORSv the Eurosystem, via national central marker when gauging the relative demand
While the new issue was expected to be banks, as it continues to reinvest maturing on offer and new issue concession required.
priced with a negative spread versus mid- holdings. “La Banque Postale does hold some
swaps, bankers said it should offer an (OWEVERûBANKERSûSAIDûTHEû"ANQUEûDEû scarcity value; a relatively new issuer that
attractive pick-up versus alternatives in the France’s absence did not appear to augur a hasn’t got as many lines outstanding and
SSA market. Bankers at the leads cited bonds change in the eurosystem’s strategy. doesn’t tend to do large transactions either.
dated 2024 and 2025 from German agency #AFlLSûõBNû&EBRUARYûûTRANSACTIONû %XECUTIONûWENTûASûEXPECTEDvûHEûADDEDû
KfW that were trading at mid-swaps minus was launched at 11bp over mid-swaps, “There’s a deeper pocket of demand
68bp and minus 54bp, respectively. inside initial guidance of the 13bp area, FURTHERûDOWNûTHEûCURVEûnûlVEûYEARSûORûLOWERû
They also said the yield on offer should be through Barclays, Commerzbank, JP Morgan, – but we can certainly see some orders in
appealing for such a defensively dated Santander and Societe Generale. this trade that we wouldn’t have seen in that
instrument. Such short-dated covered bonds Demand for the deal came in at around maturity bracket; so in parts, some investors
have been in short supply in recent years õBNûINCLUDINGûõMûOFûLEADSûINTEREST û AREûATTRACTEDûBYûTHEûABSOLUTEûHIGHûYIELDSv
largely because of the prevailing negative Bankers saw fair value at about 8bp.
yield environment, with many issuers As more supply came in over the course
preferring to push out the curve. But in of the week, bankers said the central ALL SAMURAI BONDS
today’s very different environment, with bank’s no-show appeared to be an isolated BOOKRUNNERS: 1/1/2022 TO DATE
TWO YEARûEUROûSWAPSûATûûONû-ONDAYû incident and noted European central Managing No of Total Share
morning, bankers said shorter tenors are banks were still active in other trades, bank or group issues ¥(m) (%)
back on the menu. including another French offering from LA 1 Sumitomo Mitsui 17 204,316.67 22.6
“Maybe it will see slightly less demand from BANQUE POSTALE. 2 Mizuho 27 172,933.33 19.1
THEûASSETûMANAGERûCOMMUNITYû;THANûAûTYPICALû La Banque Postale was pushing slightly =2 Nomura 27 172,933.33 19.1
COVEREDûBOND=ûBUTûTHEûTYPICALûRATESûBUYERSûTHEû further out the curve with a €1bn soft 4 Mitsubishi UFJ MS 19 171,583.33 19.0
bank treasuries and the usual suspects in the bullet long seven-year. 5 Daiwa Securities 26 134,566.67 14.9
supra and central bank space – I would expect Danske, HSBC, LBBW, La Banque Postale, 6 Natixis 5 28,600.00 3.2
THEMûTOûCAREvûSAIDûAûFOURTHûBANKER Natixis and UniCredit began marketing the 7 HSBC 4 18,666.67 2.1
ABN AMRO, Citibank, DZ Bank, LBBW and *ANUARYûûBENCHMARKû/&(ûATûTHEûMID Total 37 903,600.00
Natixis opened the books at 6bp through swaps plus 15bp area. At that initial stage, Excluding equity-related debt.
mid-swaps. Source: Refinitiv SDC code: K11
“ It was quite obvious that it would go
ALL FINANCIAL INSTITUTION BONDS IN EUROS ALL SUBORDINATED FINANCIAL INSTITUTION
well: it’s an unusual maturity; it’s got a good
BOOKRUNNERS: 1/1/2022 TO DATE BONDS (ALL CURRENCIES)
;=ûCOUPONûANDûPROVIDINGûPOSITIVEûYIELDû
Managing No of Total Share BOOKRUNNERS: 1/1/2022 TO DATE
;=ûFORûTHATûMATURITYûITSû4RIPLEû!û
bank or group issues €(m) (%) Managing No of Total Share
RATEDvûAûlFTHûBANKERûSAIDûh!NDûITSûAû
1 BNP Paribas 63 16,265.87 9.9 bank or group issues US$(m) (%)
reasonable spread in comparison to where
2 Credit Agricole 44 11,692.18 7.1 1 JP Morgan 27 7,104.01 8.6
Bunds, Laender and SSAs are in secondary
3 Deutsche Bank 52 10,259.39 6.2 2 Barclays 24 6,937.18 8.4
MARKETSûWITHûTHATûTENORv
4 HSBC 49 10,232.14 6.2 3 Bank of America 26 6,569.52 7.9
Market participants said fair value was
5 Societe Generale 55 9,106.46 5.5 4 BNP Paribas 24 5,891.10 7.1
hard to gauge owing to the secondary
6 JP Morgan 44 7,948.03 4.8 5 Citigroup 38 5,788.47 7.0
market being highly illiquid. The leads
7 Citigroup 42 7,354.13 4.5 6 HSBC 27 5,660.51 6.8
landed the trade at 12bp through and books
8 Natixis 33 6,936.66 4.2 7 Morgan Stanley 31 4,550.33 5.5
lNISHEDûINûEXCESSûOFûõBNûEXCLUDINGûLEADû
9 Barclays 41 6,473.71 3.9 8 Deutsche Bank 17 4,522.81 5.5
INTEREST
10 Morgan Stanley 30 5,409.77 3.3 9 UBS 19 3,768.37 4.5
“Great book, €1bn size, they’ve done
Total 238 164,897.95 10 Credit Suisse 14 3,300.58 4.0
everything right, it’s the biggest tightening
Including banks, insurance companies and finance companies. Excluding Total 124 82,932.52
they’ve achieved on a covered trade; so equity-related and covered bonds. Excluding publicly owned institutions.
EVERYûBOXûISûTICKEDvûTHEûlRSTûBANKERûSAID Source: Refinitiv SDC code: N11 Source: Refinitiv SDC code: J3a

Capital refi LMEs gain importance as
Shawbrook seeks swap
LIABILITY MANAGEMENT UK bank offers investors AT1 exchange while market access effectively constrained
SHAWBROOK GROUP launched an Additional Tier 1 December call date, meaning that any holder The Italian lender last month launched an
exchange offer on Monday as it seeks to replace that does not take up the exchange will continue exchange offer seeking to switch at least €200m
its old capital notes, in a type of exercise that to hold the notes and that the deal’s coupon will of its €400m of 4.5% October 2027 non-call
bankers say will become increasingly valuable reset on December 8. 2022 Tier 2 notes for a 8.25% December 2032
for issuers over the coming months. In its stead, Shawbrook is offering investors a non-call 2027 transaction, ahead of the old
Bankers said it made sense for the UK lender new perpetual AT1 instrument with a minimum size notes’ one-time call date on October 17. While
to use an exchange rather than attempting to of £100m, which will be callable in June 2028. the old notes have a 425.1bp reset, the new one
refinance the notes with a new issue given recent To encourage investors to swap, the new would have had a 577.4bp reset.
volatility, particularly surrounding Gilts and UK instrument will have a reset that is 100bp IFIS ultimately withdrew the exchange after
institutions. UK banks underperformed amid the higher than on the old notes, at 809.9bp versus receiving insufficient interest, even after cutting
fallout from the recent mini budget, but issuance 709.9bp over Gilts. the minimum size to €125m.
of bank capital has dried up from all jurisdictions Bankers said, however, that the likely Some bankers suggested the economics
over recent weeks as market conditions turned cost required to clear a new issue would be of the exchange were insufficiently attractive
for the worse. substantially higher. “This is a great middle for investors from the outset, while others
That is forcing smaller issuers such as ground to effectively refinance the transaction in suggested that volatility in rates during the
Shawbrook, which have refinancing needs, to a way that keeps investors onboard and happy,” exchange offer period was more to blame.
consider different strategies to circumvent the said Kapil Damani, head of capital solutions, All agreed, however, that AT1 and Tier
risks and costs of braving the primary market, DCM, at BNP Paribas. 2 exchanges are fundamentally different
while also keeping investors onside and getting Shawbrook said that prior to the propositions for investors due to the differing
regulatory approval to redeem existing capital. announcement of the exchange, it had discussed levels of extension risk in perpetual AT1s, where
The use of an exchange can allow an issuer to the potential transaction with bondholders the frequency of call dates can vary, and dated
fulfil each of those objectives, said bankers. that collectively own 89% of the old notes and Tier 2s, which typically have one-time calls five
“There is an intention to prove to the regulator have indicated they are supportive of the 100bp years ahead of their final maturity.
that there is going to be no leakage of capital premium offered and intend to exchange their There are, however, other more successful
when they go through the transaction,” said full holding into the new securities. It said the examples for issuers to turn to in the AT1 market.
Vaibhav Garg, head of capital advisory and transaction was structured to take into account Bankers drew a parallel between Shawbrook’s
liability management at Nomura. “They could “the long-term support” of its AT1 investor base. exercise and Coventry Building Society’s move
have done a tender and new issue, but with that in 2019 to repurchase some of its old £400m
there is a possibility that investors take the cash CAUTIONARY TALE 6.375% AT1 offering while issuing new notes in the
and walk away and the bank is not able to do a With market access expected to remain primary market – a move welcomed by investors.
new issue.” challenging for smaller or lower-rated issuers In another more recent example from the UK,
“In the case of an exchange, the capital is with more limited investor bases, bankers Virgin Money UK was able to repurchase £377m
reinstated in all aspects and conditions. It ticks said such LMEs – while not a one-size-fits-all of its £450m 8% AT1 issue in a tender offer in
the boxes for the regulator given there will be no solution – are becoming increasingly important. June. It announced last week that it would call
reduction in capital.” “For all issuers that may be trying to hedge the remainder of the notes at their first call
The any-and-all exchange offer, led by new issues or may not have proper market date, which like Shawbrook’s transaction is on
Barclays, NatWest Markets and UBS, is targeting access, having access to LMEs, whether December 8.
Shawbrook’s £125m of 7.099% perpetual AT1s, exchanges or tender offers, can help them “These tools will be really valuable for
which will reach their first call date on December through these conditions,” said Garg. refinancing AT1 instruments or Tier 2s issued
8 2022. However, a failed exchange offer in the by non-national champions or smaller credits,”
Shawbrook said that after “considering Tier 2 space from Banca IFIS offered a recent said Damani. “Being open to these ideas will be
potential options”, it does not intend to exercise reminder that such transactions are not always critical.”
the call option of the existing notes at their straightforward. Tom Revell
OP DOUBLES BACK TO EURO SENIOR 2OCKYûMARKETSûANDûAûFOCUSûONûINmATIONû 115bp area. The leads got about €750m in
MARKET data meant there was only limited appetite orders and were able to print the trade at
for riskier paper, as was evident in the 105bp.
OP CORPORATE BANK stood alone in the euro response to OP’s deal. “The fact that pricing is being tightened
bank senior sector last week, gaining “Size-wise it’s probably a little bit on the low these days is a relative success, to put it in a
limited traction for a €500m April 2027 side of what they would probably be looking nice way. The order book is not particularly
senior preferred transaction. for these days but the order book couldn’t OVERWHELMINGûBUTûTHISûISûWHATûTHEû;SENIOR=û
4HEû&INNISHûISSUERûWASûTHEûONLYûlNANCIALû deliver it; that’s been the case for other issuers MARKETûISûLIKEûRIGHTûNOWvûSAIDûTHEûBANKER
institution to attempt a euro-denominated TOOvûSAIDûAûBANKERûAWAYûFROMûTHEûDEALû Suggesting another reason behind the
unsecured issue last week, as covered bonds Bank of America, Barclays, OP and Societe muted appetite for the deal, bankers noted
DOMINATEDûTHEûmOWûOFûSUPPLY Generale opened books at mid-swaps plus OP had issued a €1.25bn long three-year

BONDS FIG
senior preferred offering just over a month Bankers credited the deal’s outperformance Bankers also said it was positive that the
ago, drawing almost €2bn of demand on to the relative rarity of BayernLB as an issuer books for both trades were reported to
that occasion. and the quality of its covered bond collateral, HAVEûGROWNûAFTERûlNALûTERMSûWEREûSETû
Bankers calculated that the deal offered a as well as the issue’s green label. from €600m-plus to €700m-plus for
lNALûNEWûISSUEûPREMIUMûOFûABOUTûBPn Argenta and, more modestly, from €700m
30bp. “It is a bit lacklustre, despite offering a GERMANY WINS EXCLUDINGûLEADS ûTOûõMûINCLUDINGû
QUITEûGENEROUSûCONCESSIONvûSAIDûAûSECONDû h4HEûWINNERûONCEûAGAINûISûOUTûOFû'ERMANYvû õMûLEADSûINTEREST û
banker. SAIDûTHEûlRSTûSYNDICATEûBANKER
“Yesterday was easier to properly analyse, LB BERLIN SEALS BENCHMARK PRICE
BAYERNLB KEEPS A LID ON RISING ASû,""7ûOUTPERFORMEDûBEINGûTHEûlRSTûTWO
PREMIUMS year in a very long time and still offering a LANDESBANK BERLIN on Thursday capitalised
good yield and a triple-digit spread over on strong support from domestic investors
BAYERNLB bucked the trend of rising Bunds. Today, the closest to that success is for a €250m long four-year Pfandbrief issue
concessions in the euro covered bond space BayernLB, again with a high quality cover to price the sub-benchmark offering at a
WHENûITûLANDEDûANûALMOSTûlVE TIMESû pool. Being green also normally saves you similar level to recent benchmark-sized
SUBSCRIBEDûlVE YEARûGREENû0FANDBRIEFûDEBUTû 1bp–2bp, so those are probably the reasons trades from its compatriots.
on Wednesday, the busiest day for euro FORûITSûSUCCESSv Bookrunners DZ Bank and NordLB
covered bond supply in over a month. Bankers described COMMONWEALTH BANK OF marketed the April 2027 transaction with
The covered bond market was the only AUSTRALIA as the day’s other clear winner in initial guidance of mid-swaps plus 1bp
show in town for FIG issuers on Wednesday, the euro covered bond primary market. area.
with four issuers bringing €2.5bn of supply Demand was more modest for its three-year The level was subsequently revised to
– the most in a single day since September OFFERINGûTOPPINGûõBNûBUTûSTILLûSUFlCIENTû MINUSûBPûnBPû70)2 ûWITHûBOOKSû
12, according to IFR data. In contrast, the for the Australian lender to print a €1bn ABOVEûõMûEXCLUDINGûLEADS
senior unsecured market drew a blank, after trade. Demand fell slightly to above €500m
/0û#ORPORATEû"ANKûGATHEREDûJUSTûOVERû Elsewhere on Wednesday, transactions EXCLUDINGûLEADSûPRE REC ûASûTHEûSPREADûWASû
€685m of demand for a €500m 4.5-year from ARGENTA SPAARBANK and HYPO VORARLBERG lXEDûATûMINUSûBPû
senior preferred transaction on Tuesday. 6ORHYP ûINûTHEûFOUR YEARûPARTûOFûTHEûCURVEûGOTû A syndicate banker at one of the leads
“Issuance has clearly pivoted to covered more limited demand, an outcome that said the deal, while domestically-focused
bonds, which is probably not a huge bankers attributed to both being relatively and driven almost entirely by German
SURPRISEûAFTERûAûLACKLUSTREûEXECUTIONûFORû/0vû infrequent, less well-followed issuers. In DEMANDûWASûNEVERTHELESSûhAûNICEûSUCCESSvû
said a syndicate banker. 6ORHYPSûCASEûBANKERSûALSOûSUGGESTEDûTHEREûISû
After LBBW secured a blowout €1bn two- some saturation in the Austrian covered bond ALL COVERED BONDS (ALL CURRENCIES)
year Pfandbrief on Tuesday, getting more market after €15.6bn of supply year-to-date. BOOKRUNNERS: 1/1/2022 TO DATE
than €5.1bn of demand (see separate Both were deemed to have paid Managing No of Total Share
ARTICLE ûBANKERSûREITERATEDûTHATûSHORTERû concessions of 4bp–5bp after tightening 2bp bank or group issues US$(m) (%)
tenors are the name of the game in the from initial guidance. 1 LBBW 80 12,701.59 5.5
covered bond space. !RGENTASûõMûNO GROW ûSTRAIGHTûFOUR 2 DZ Bank 67 11,499.82 5.0
Demand is said to be deepest at the short- year was priced at 14bp, through Barclays, 3 Natixis 60 10,557.36 4.6
end, where rising rates mean that even a "ELlUSû,""7ûand Natixis. 4 UniCredit 68 10,368.30 4.5
two-year trade can now offer an attractive 6ORHYPSûõMûNO GROW ûLONGûFOUR YEARû 5 Credit Agricole 53 9,905.84 4.3
yield, and where covered bonds’ relative – with a February 2027 maturity – was 6 HSBC 44 9,593.21 4.2
value versus SSAs is most compelling. priced at 16bp, via Commerzbank, DekaBank, 7 BNP Paribas 44 9,561.18 4.2
Investor nervousness given the choppy Deutsche Bank, Erste Group and LBBW. 8 Commerzbank 53 9,426.76 4.1
market backdrop is also pushing people to “They did not get a lot of momentum but 9 UBS 31 8,502.50 3.7
favour more defensive tenors. they were still able to move 2bp, which is 10 ING 44 7,955.87 3.5
No issuers kept tenors as short as LBBW PROBABLYûGOODûENOUGHvûSAIDûAûTHIRDû Total 264 229,623.10
on Wednesday, but none pushed further out syndicate banker. Source: Refinitiv SDC code: J15a
THANûTHEûlVE YEARûPOINTû
ALL GLOBAL AND EUROMARKET YEN BONDS ALL INTERNATIONAL YEN BONDS
Despite market participants’ insistence
that shorter is better, BayernLB garnered the
BIGGESTûBOOKûOFûTHEûDAYûFORûITSûlVE YEARû Managing No of Total Share Managing No of Total Share
bank or group issues ¥(m) (%) bank or group issues ¥(m) (%)
inaugural green Pfandbrief, pulling in more
than €2.4bn of orders. 1 Nomura 13 174,600.00 21.9 1 Nomura 40 347,533.33 20.4
That demand allowed leads BayernLB, Erste 2 Societe Generale 4 162,500.00 20.3 2 Sumitomo Mitsui 23 281,391.67 16.5
Group, Natixis, Santander and Societe Generale 3 Mizuho 4 87,408.33 10.9 3 Mizuho 31 260,341.67 15.3
TOûLAUNCHûTHEûõMûNO GROW ûDEALûATûMID 4 Sumitomo Mitsui 6 77,075.00 9.6 4 Mitsubishi UFJ MS 23 221,158.33 13.0
swaps minus 3bp, inside initial guidance of 5 JP Morgan 4 57,833.33 7.2 5 Societe Generale 4 162,500.00 9.5
the plus 2bp area. 6 Bank of America 2 52,833.33 6.6 6 Daiwa Securities 27 147,066.67 8.6
!TûTHEûlNALûLEVELûTHEûTRANSACTIONûWASû 7 HSBC 1 50,000.00 6.3 7 HSBC 5 68,666.67 4.0
deemed to have offered the smallest new issue 8 Mitsubishi UFJ MS 4 49,575.00 6.2 8 JP Morgan 4 57,833.33 3.4
concession of the day, at around 2bp at most. 9 Goldman Sachs 3 27,600.00 3.5 9 Bank of America 2 52,833.33 3.1
h.)0SûAREûDElNITELYûHIGHERûBUTûTHEûWAYûTOû 10 ANZ 1 14,850.00 1.9 10 Natixis 5 28,600.00 1.7
counterbalance that is to go short or cap the Total 31 798,875.00 Total 68 1,702,475.00

Excluding equity-related debt. Including preferreds. Including all Euro, foreign and global issues. Excluding equity-related
SIZEûANDûUSEûAûGREENûLABELûLIKEû"AYERN,"vû debt.
said a second syndicate banker. Source: Refinitiv SDC code: K10 Source: Refinitiv SDC code: K12

“€250m at minus 3bp ticked a lot of boxes the fact that the issuer is located in a ANDûPUSHEDûBACKûTHEûISSUANCEvûSAIDûAû
FORûTHEûISSUERvûHEûSAIDû RELATIVELYûSAFEûPARTûOFûTHEûWORLDv Japanese fund manager.
Notably, the deal was priced in line with a Australia’s largest bank in terms of assets Daiwa, Mitsubishi UFJ Morgan Stanley,
six month longer benchmark Pfandbrief previously accessed the euro covered market Mizuho, Nomura, SMBC Nikko and Societe
issue from BayernLB on Wednesday. ONû&EBRUARYûûWITHûAûõBNûûSIX Generale were the joint lead managers.
BayernLB priced a €500m October 2027 year issue which priced at 10bp over The expected ratings are Baa2/BBB/A– for
green transaction at minus 3bp. mid-swaps. the SNP tranches and Baa3/BBB–/BBB/A–
Bankers said that was made possible by #"!ûALSOûTHISûYEARûISSUEDûAû53BNû -OODYS30&ITCH2) ûFORûTHEû4IERûû
the support of domestic investors, three-year covered bond on May 16 and tranche.
particularly those in the German savings raised SFr500m from a dual-tranche, three-
banks network, who are less sensitive to a year and six-year, covered sale on August 11.
deal’s size. NON-CORE CURRENCIES
“To have a €250m deal price at
benchmark level is almost unthinkable in YEN SUNCORP SECURES AMPLE COVER
OTHERûJURISDICTIONSvûSAIDûTHEûLEADûSYNDICATEû
BANKERûh)TûISûAûVERYû'ERMANûTYPEûOFûTHINGv SOCIETE GENERALE DROPS TRANCHES SUNCORP-METWAYû!!! ûATTRACTEDûSTRONGû
The deal is Landesbank Berlin’s third interest for a three-year covered bond deal
publicly-issued covered bond offering of the SOCIETE GENERALE on Friday raised only that offered a modest pick-up over major
year, following a €250m 10-year in January cBNû53M ûFROMûTHEûFOUR PARTûSALEû bank paper.
and a €300m short four-year in August. of euroyen bonds after dropping three of the The Brisbane-headquartered bank raised
The new issue could not match the initially planned seven tranches, offering A$750m from the dual-tranche sale that was
surprising popularity of that €300m May fresh evidence that Japanese investors have HEADEDûBYûAû!MûmOATING RATEûNOTEû
2026 transaction, which drew more than become selective on European credits. WHICHûPRICEDûINSIDEûBPûAREAûGUIDANCEûATû
€1.6bn of demand in August as it was The bond offering consisted of a ¥8.5bn three-month BBSW plus 88bp.
launched into an exuberant primary market 1.553% four-year non-call three senior non- !û!MûlXED RATEûNOTEûPAYSûAûû
that had been reset and refreshed by the PREFERREDûTRANCHEûAûcBNûûSIX YEARû COUPONûANDûPRICEDûATûûFORûAûYIELDûOFû
summer break. NON CALLûlVEû3.0ûTRANCHEûAûcBNûû 4.876%, 88bp wide of asset swaps.
Now, after heavy supply in the year non-call nine SNP tranche and ¥10bn of ANZ, CBA, Citigroup, NAB and RBC Capital
intervening months and with broader û YEARûNON CALLûlVEû4IERûûCAPITALû Markets were joint lead managers for
market conditions remaining turbulent, notes. Suncorp-Metway, which is in the process of
bankers noted a wearier tone hangs over the Initial guidance for the completed SNP being acquired by major bank Australia and
covered bond market. tranches was 135bp–140bp, 165bp–170bp, New Zealand Banking Group.
Nevertheless, they said it was still clearly and 175bp–180bp and the trades were The proposed takeover is subject to
outperforming unsecured market segments lNALISEDûATûTHEûWIDEûENDSûOFûTHEûINITIALû APPROVALûBYûTHEû!USTRALIANû#OMPETITIONûANDû
– in which there was only one trade last ranges for all three on Thursday. #ONSUMERû#OMMISSIONûWHICHûISûEXPECTEDû
week, a €500m senior preferred for OP Price guidance for the Tier 2 bonds to rule in the second half of 2023.
CORPORATE BANK – and will still be many remained unchanged throughout the The 8bp or so premium over the current
ISSUERSûlRSTûPORTûOFûCALLûINûTHEûCOMINGû marketing process at an absolute yield of 80bp area clearing margin for major bank
weeks. 3.2%. THREE YEARûCOVEREDûBONDSûREmECTSûTHEû
“For the rest of the capital structure, it is When the French bank started marketing possibility that the acquisition does not go
very hard for investors to be enthusiastic on Wednesday, it also showed initial price ahead, explained a syndication manager.
because of the overall volatility we’re guidance for three senior preferred tranches
SEEINGvûSAIDûAûSECONDûSYNDICATEûBANKERû at 65bp–70bp over Tonar mid-swaps for a
THREE YEARûBPnBPûOVERûFORûAûlVE YEARû
CBA TAKES ADDITIONAL COVER ANDûBPnBPûOVERûFORûAû YEARûTRANCHEû
The bank dropped the three and 10-year HIGH-YIELD
COMMONWEALTH BANK OF AUSTRALIA navigated a tranches on Thursday and continued
DIFlCULTû7EDNESDAYûBACKDROPûTOûRAISEûõBNû MARKETINGûTHEûlVE YEARûNOTESûATûBPû
from a three-year covered bond offering via before dropping that tranche as well. UNITED STATES
Barclays, BNP Paribas, CBA and Deutsche Bank. The disappointing size came after peer
Demand in excess of €1.35bn was "ANQUEû&EDERATIVEûDUû#REDITû-UTUELûDREWûAû RXO UPSIZES BOND TO FUND SPIN-OFF
SUFlCIENTûTOûPRICEûTHEûû/CTOBERûû lukewarm ¥52.2bn of demand for its SP
2025s inside the 20bp area guidance at mid- 3AMURAIûDEALûEARLIERûTHISûMONTHû"&#-ûHASû Freight technology developer RXO priced an
swaps plus 18bp, 137.1bp wide of Bunds. completed deals of more than ¥100bn six upsized bond last week to fund its spin-off
2EmECTINGûITSûSIZEûAMBITIONSûANDûSTATUSûASû times in the past. from parent XPO Logistics.
a non-eurozone eligible issuer, bankers said Sources said Japanese investors have 4HEû53MûlVE YEARûNON CALLûTWOû
#"!ûPAIDûAûCONCESSIONûOFûBPnBP become selective on European FIG credits senior note priced on Tuesday with a 7.50%
“This was the right instrument with the because of concerns about the impact of COUPONûATûûTOûYIELDûûONûTHEû
right tenor for a volatile market and Russia’s invasion of Ukraine on the tighter side of price talk of a 7.75%–8% yield.
underlines why covered bond legislation European economy, and after concerns The bond, which priced on October 12,
WASûPASSEDûINû!USTRALIAûINûvûONEû EMERGEDûABOUTûTHEûlNANCIALûHEALTHûOFû#REDITû was upsized by US$5m.
syndicate manager said. Suisse. Bank of America was lead-left on the deal.
“Investors appreciate the pickup over “Markets have been volatile and Citigroup, Barclays, Goldman Sachs, KeyBanc,
Triple A alternatives, including SSAs and ESPECIALLYûSOûAFTERûTHEû53û#0)ûREPORTû;ONû Morgan Stanley, Scotia and Wells Fargo were
EUROZONEûANDû#ANADIANûCOVEREDûBONDSûANDû 4HURSDAY=ûSOûTHEûISSUERûSHOULDûHAVEûWAITEDû joint bookrunners.

BONDS HIGH-YIELD
XPO Logistics was last in the high-yield On Wednesday, EnQuest sold a US$305m
primary market in April 2020, pricing EUROPE/MIDDLE EAST/ lVE YEARûNON CALLûTWOûSENIORûUNSECUREDûNOTEû
53MûOFûlVE YEARûSENIORûNOTESûATûû AFRICA offering. The UK oil and gas company priced
and tapping the market for a US$300m the bond issue at with an 11.625% coupon
add-on a month later. BLUEWATER PLANS DOLLAR and increased its size by US$5m. There are
XPO’s 6.25% 2025 notes were trading on REFINANCING BONDS also deals pending for Italian paper
Thursday at a price of 100.50 to yield company FEDRIGONI and London-
ûACCORDINGûTOû-ARKET!XESS BLUEWATER HOLDING unveiled plans on headquartered ODEON CINEMAS, a subsidiary of
Moody’s and S&P rates RXO’s notes Baa3/ Thursday to issue US$240m of four-year !-#û%NTERTAINMENTû
""û30ûASSIGNEDûAû""ûISSUERûRATINGûTOû SENIORûUNSECUREDûNOTESûTOûRElNANCEûAû While Bluewater’s core business hinges
RXO with a positive outlook saying it maturing Oslo-listed bond offering. on oil and gas, the Dutch company has
expects the company’s credit metrics to 4HEû.ETHERLANDS BASEDûmOATINGû drafted an energy transition strategy. Its
improve following the spin-off. PRODUCTIONûANDûOFmOADINGû&03/ ûVESSELû selected renewable energy projects include
“Although we expect spot market owner will use the net proceeds from mOATINGûWINDûmOATINGûSOLARûANDûOFFSHOREû
pricing for trucking will decline the new bonds to repay in full the charging vessels.
over the next 12 months, we believe outstanding US$200m October 2023 note Norweigian investment banks DNB
28/ûWILLûBENElTûFROMûITSûABILITYûTOû issue, pay back any amounts outstanding Markets and Pareto Securities are set to arrange
procure capacity at competitive rates and under the existing senior secured AûSERIESûOFûlXED INCOMEûINVESTORûMEETINGSû
continue to increase market share within revolving credit facility and for general from Friday to sound out the market. A
ITSûCOREûBROKERAGEûSEGMENTvûSAIDû30û corporate purposes. global investor call will take place on
in its note. On Thursday, the 10% October 2023 dollar October 17.
BONDûISSUEûWASûQUOTEDûATûAûûYIELDûONû
NIELSEN GOES PRIVATE IN US$16bn LBO Eikon. STADA LAUNCHES EXCHANGE OFFER
The new issue would be the fourth bond TO TACKLE LEGACY DEBT
The US$16bn leveraged buyout deal to offering from Bluewater, a fully-owned
TAKEû46ûRATINGSûPROVIDERûNIELSEN private has SUBSIDIARYûOFû!URELIAû(OLDINGûINûTHEû.ORDICû German pharmaceutical company STADA
closed, according to a statement last week, high-yield market since 2007. It is part of a ARZNEIMITTEL launched on Thursday an
with banks providing more than US$10bn MINIûmURRYûOFûBONDûDEALSûBYû%UROPEANûHIGH exchange offer to roll over maturing
INûDEBTûlNANCING yield issuers. legacy debt, as a dysfunctional new issue
%LLIOTTû-ANAGEMENTûANDû"ROOKlELDû
Asset Management led an investor ALL US$ DENOMINATED HIGH-YIELD BONDS ALL ASIAN HIGH-YIELD ISSUERS
consortium for the LBO that will see BOOKRUNNERS – 1/1/2022 TO DATE 1/1/2022 TO DATE
Nielsen shareholders receive US$28 Managing No of Total Share Managing No of Total Share
per share. The deal was announced bank or group issues US$(m) (%) bank or group issues US$(m) (%)
in March.
1 Goldman Sachs 56 9,083.15 9.7 1 JP Morgan 3 1,537.50 18.5
Banks providing more than US$10bn in 2 Credit Suisse 3 497.42 6.0
2 JP Morgan 60 8,762.85 9.4
DEBTûlNANCINGûFORûTHEûDEALûAREûSITTINGûONûAû 3 Citigroup 54 6,863.43 7.4 3 Societe Generale 2 475.00 5.7
US$2.5bn term loan A, a US$3.35bn term 4 Bank of America 67 6,769.89 7.3 =3 Citigroup 2 475.00 5.7
LOANû"ûAûõMû53M ûTERMûLOANû"û 5 Morgan Stanley 40 6,249.78 6.7 5 Deutsche Bank 4 416.52 5.0
a US$650m revolving credit facility, a 6 Wells Fargo 47 4,557.63 4.9 6 Morgan Stanley 2 385.39 4.6
US$2.15bn second lien term facility, and a 7 Barclays 43 4,212.18 4.5 7 HSBC 6 374.33 4.5
53BNûBRIDGEûTERMûFACILITYûACCORDINGû 8 Credit Suisse 34 3,823.27 4.1 8 Barclays 4 306.10 3.7
TOûANû/CTOBERûû3%#ûlLING 9 Deutsche Bank 27 2,797.12 3.0 9 Goldman Sachs 3 258.21 3.1
Firms including Bank of America, 10 RBC 30 2,522.67 2.7 10 Credit Agricole 2 233.31 2.8
Citigroup, Goldman Sachs, KKR Capital Markets Total 131 93,309.58 Total 17 8,327.28
and Ares Capital provided the debt Including US domestics, Euro, foreign, globals. Excluding equity-related debt. Excluding equity-related debt.
commitments. Source: Refinitiv SDC code: B5 Source: Refinitiv SDC code: B06d
Nielsen’s buyout was delayed after
WindAcre, Nielsen’s largest shareholder ALL NON-DOLLAR DENOMINATED HIGH-YIELD BONDS ALL EUROPEAN HIGH-YIELD ISSUERS
initially opposed it, saying the price per 1/1/2022 TO DATE 1/1/2022 TO DATE
share was too low. In August, WindAcre Managing No of Total Share Managing No of Total Share
agreed to join the buyout shops as part of bank or group issues €(m) (%) bank or group issues US$(m) (%)
the consortium. 1 Goldman Sachs 21 6,024.90 21.1
1 Goldman Sachs 15 1,942.08 10.8
Meanwhile, volatile debt market 2 Deutsche Bank 19 1,965.80 6.9
2 Deutsche Bank 17 1,576.92 8.8
conditions have delayed a number of other 3 Credit Suisse 9 1,284.22 7.1 3 Credit Suisse 11 1,753.34 6.1
LBO deals, including for auto parts maker 4 JP Morgan 13 1,278.84 7.1 4 JP Morgan 14 1,674.21 5.9
TENNECO and broadcast and media company
5 BNP Paribas 14 987.22 5.5 5 Bank of America 12 1,613.65 5.7
TEGNA. 6 BNP Paribas 15 1,268.96 4.4
6 Barclays 10 863.82 4.8
Last month, the bonds and loans 7 UniCredit 8 808.31 4.5 7 Morgan Stanley 12 1,194.27 4.2
backing Apollo’s US$7.5bn LBO of 8 Morgan Stanley 10 808.11 4.5 8 Barclays 12 1,142.76 4.0
Brightspeed were withdrawn, with the 9 Credit Agricole 7 599.30 3.3 9 UniCredit 8 903.97 3.2
internet provider citing market conditions. 10 Citigroup 6 577.07 3.2 10 Citigroup 8 876.28 3.1
Banks that are underwriting LBO deals Total 47 18,007.22 Total 54 28,528.08
in the pipeline are sitting on more than Excluding equity-related debt. Excluding equity-related debt.
US$20bn in debt commitments. Source: Refinitiv SDC code: B6 Source: Refinitiv SDC code: B06c

market prompts companies to engage in The size of the deal, which is split across (2ûWEREûFORCEDûTOûCANCELûBONDûOFFERINGSûASû
liability management exercises to address AûlVE YEARûNON CALLûTWOûSENIORûSECUREDû investors got cold feet amid heightened
repayments. lXED RATEûBONDûANDûAûlVEûNON CALLûONEû market volatility.
The company, owned by private equity SENIORûSECUREDûmOATING RATEûNOTEûWASû Inetum was trying to sell €300m six non-
DUOû"AINûANDû#INVENûISûSEEKINGûTOû increased by €150m on Thursday. call two senior secured notes at a
convince holders of its 3.5% 2024 senior Bankers had announced the marketing nûCOUPONûHIGHûS ûINITIALû
secured notes to exchange into a new 7.5% of an €875m deal at the beginning of the price talk before arrangers decided to drop
four-year senior secured bond issue, in a week, lower than the €1bn projected in the bond. They instead upsized the loan
bid to extend a minimum of €500m debt July, when a Goldman Sachs-led group of ELEMENTûOFûTHEûlNANCINGûAFTERûDEMANDû
by two years. lenders provided a €1.18bn bridge loan to from high-yield investors proved
The €200m of September 2024 senior BACKûPRIVATEûEQUITYûlRMû"#û0ARTNERSû UNDERWHELMINGû(OUSEûOFû(2SûBONDûSALEû
SECUREDûNOTESûWHICHûRANKûlRSTûINû purchase of a 50% stake in Fedrigoni from WASûDROPPEDûEVENûBEFOREûOFlCIALûPRICINGû
ACCEPTANCEûPRIORITYûTRADEDûATûûONû RIVALû"AINû#APITALû4HEûlNANCINGûPACKAGEû had emerged, but another investor said
Thursday, up from Monday’s close at also initially included a €150 term loan A that he would have expected the bond to
ûACCORDINGûTOû4RADEWEB or other senior secured debt and a €150m HAVEûCOMEûINûTHEûREGIONûOFûWHEREûITSûlRSTû
Second priority was given to the revolving credit facility. The increase will lien loans priced, around low 10%.
€1.685bn of September 2024 senior be used to take out the full term loan A. 4HEûlRSTûINVESTORûSTRESSEDûTHATû
SECUREDûNOTESûWHICHûTRADEDûATûû 4HEûõMûlXEDûRATEûISûBEINGûOFFEREDûATû Fedrigoni’s business was less cyclical than
Tradeweb data showed. an 11.75%–12% IPT, the tighter end of price (OUSEûOFû(2ûWHICHûMADEûHIMûKEENERûONû
Deutsche Bank and JP Morgan are the WHISPERSûREmECTINGûANû/)$ûOFûnû the deal.
dealer-managers. The exchange offer The €725m FRN is being marketed at The higher yield on offer may have
EXPIRESûONû/CTOBERûûWITHûSETTLEMENTû %URIBORûPLUSûBPûAREAûWITHûAûûmOORû quelled investor angst despite signs that
expected on November 2. ANDûAûûCALLûPROTECTIONû4HEû/)$ûISûnû central banks’ interest rate rises have done
The issuer, NIDDA HEALTHCARE HOLDING, will area, increasing one point from guidance. LITTLEûTOûTAMEûINmATIONû/FlCIALûDATAûONû
not receive any cash proceeds from the Lucror Analytics estimated fair value for Thursday showed that US core consumer
issue of the new notes in the exchange THEûlXED RATEûBONDûATûn price index, which excludes volatile
offer. Any fees or expenses related to the “The premium is good enough to get the energy and food prices, rose 6.6% in
exchange offer will be funded with cash. DEALûDONEvûONEûHIGH YIELDûINVESTORûSAIDû September from a year earlier, the biggest
4HISûISûNOTûTHEûlRSTûLIABILITYûMANAGEMENTû THOUGHûNOTINGûTHEûPRICINGûREmECTSûTHEûDIREû increase in four decades. This signals the
exercise undertaken by the German BACKDROPûANDûHOWûDIFlCULTûITûISûFORû Fed will have to tighten monetary policy
DRUGMAKERû)Nû*UNEûû3TADAûCOMPLETEDû companies to price transactions in the more aggressively, stoking rates volatility
a liability management exercise also aimed current market environment. further.
at tackling legacy debt. At the time, it only $ESPITEûTHEûJUMBOûDEALûSIZEûTHEûlXED Market participants had raised questions
bought back about €6.68m of its 1.75% rate component is relatively small. It was on whether Fedrigoni’s deal would get over
2022 notes from a target of the full CONlRMEDûATûõMûTHEûMINIMUMûTHEû THEûLINEûIFûTHEû53ûINmATIONûREADINGûMISSEDû
outstanding amount, €274m, via a tender issuer was seeking compared with a expectations.
offer opened in January. The notes were maximum of €350m, while the FRN
issued by Stada’s opco in April 2015 and increased to the maximum of the target
contain a negative pledge clause. range of €675m–€725m.
Stada joins a string of junk corporate The OID is lower than discounts seen in
issuers in executing liability management previous LBO-related bond sales, likely STRUCTURED FINANCE
exercises to tackle upcoming debt REmECTINGûTHEûTIMINGûOFûWHENûBANKSû
maturities. In recent weeks, Europe’s underwrote the deal. Unlike underwrites
biggest payments group Nexi, South signed before the market plunged earlier EMEA MBS
African papermaker Sappi and UK luxury this year, this transaction’s caps, or the
carmaker Aston Martin Lagonda have all maximum interest rate the borrower can FINANCE IRELAND MEZZ FALLS
launched tender offers to buy back debt at PAYûANDûMARKETûmEXûRIGHTSûWEREûSETû SHORT OF RESERVE PRICE
a discount. Similarly, Spanish fashion according to conditions in July, giving
retailer Tendam Brands launched an bankers more wiggle room, said a source FINANCE IRELAND MANAGEDûTOûPRICEûTHEû#LASSû
exchange offer to roll over upcoming with knowledge of the matter when the A notes of its €420.2m Irish owner-
maturities. DEALûWASûlRSTûANNOUNCED occupied RMBS FINANCE IRELAND RMBS NO. 5
The debt, issued via Fiber Bidco, has inside 100bp on Wednesday but the
FEDRIGONI SET TO PRICE LARGEST expected credit ratings of B2/B/BB–. Goldman mezzanine tranches were not placed as
EURO JUNK BOND SINCE FEBRUARY Sachs is sole global coordinator and physical reserve levels could not be reached,
bookrunner, while IMI-Intesa San Paolo, Morgan according to a banker at one of the leads.
FEDRIGONI upsized a bumper two-tranche Stanley, Santander, Nomura, UniCredit and BPER “We had a few conversations, but in the
bond on Friday, in a sign that the bruised Banca are acting as joint bookrunners. end, from where the seller effectively
euro high-yield market can still absorb needed it to make sense from a reserve
jumbo deals despite two failed LBO-related THIRD TIME LUCKY level, it didn’t make sense to offer that
bond sales in recent weeks. The bond marks the third attempt by OUTRIGHTvûSAIDûTHEûBANKERûh)TSûNOTû
The Italian paper company was set BANKSûINûRECENTûWEEKSûTOûOFmOADû,"/ surprising given the context of how much
to print a €1.025bn dual-tranche, related debt from their balance sheets, PAPERûISûOUTûTHEREv
marking the largest transaction in the AFTERûUNDERWRITERSûlNANCINGûBUYOUTûDEALSû The discount margins on the mezzanine
euro high-yield market since February FORû&RENCHû)4ûSERVICESûANDûCONSULTINGûlRMû tranches came in at 275bp over three-
this year. )NETUMûANDû"ELGIANûSTAFlNGûlRMû(OUSEûOFû month Euribor for the Double A rated

STRUCTURED FINANCE
NEW ASSET–BACKED SUMMARY DETAILS: WEEK ENDING 14/10/2022

Issuer Amount (m) WAL DM Bookrunner(s) Rating Asset type
DTRT 2022–1 US$360.000 0.82 I–CRV+90bp JP Morgan/BofA/SMBC Nikko Aaa/NR/AAA ABS
EART 2022–5 US$68.400 0.13 I–CRV+50bp Wells Fargo/Deutsche Bank/JP Morgan NR/A–1+/F1+ ABS
EART 2022–5 US$121.153 0.50 I–CRV+120bp Wells Fargo/Deutsche Bank/JP Morgan NR/AAA/AAA ABS
EART 2022–5 US$84.768 1.14 I–CRV+145bp Wells Fargo/Deutsche Bank/JP Morgan NR/AAA/AAA ABS
EART 2022–5 US$84.616 1.87 I–CRV+190bp Wells Fargo/Deutsche Bank/JP Morgan NR/AA/AA ABS
EART 2022–5 US$75.458 2.65 I–CRV+250bp Wells Fargo/Deutsche Bank/JP Morgan NR/A/A ABS
EART 2022–5 US$74.537 3.51 I–CRV+350bp Wells Fargo/Deutsche Bank/JP Morgan NR/BBB/BBB ABS
EART 2022–5 US$60.790 4.44 I–CRV+680bp Wells Fargo/Deutsche Bank/JP Morgan NR/BB/BB ABS
FINANCE IRELAND RMBS NO. 5 DAC €355.15 2.94 3mE+90bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/AAA/NR RMBS
FINANCE IRELAND RMBS NO. 5 DAC €20.64 3.42 3mE+175bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/AA/NR RMBS
FINANCE IRELAND RMBS NO. 5 DAC €11.35 3.42 3mE+250bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/A/NR RMBS
FINANCE IRELAND RMBS NO. 5 DAC €7.22 3.42 3mE+325bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/BBB/NR RMBS
FINANCE IRELAND RMBS NO. 5 DAC €6.19 3.42 3mE+375bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/BB/NR RMBS
FINANCE IRELAND RMBS NO. 5 DAC €7.2 – 3mE+450bp BofA/BNP Paribas/Citigroup/Standard Chartered NR/NR/NR RMBS
Freddie Mac SPC Series Q–018 US$339.304 2.27 SOFR+87bp JP Morgan/Barclays NR/NR/NR CMBS
JDOT 2022–C US$310.000 0.33 I–CRV+35bp Citigroup/BofA/Credit Agricole/MUFG P–1/NR/F–1+ ABS
JDOT 2022–C US$439.211 1.13 I–CRV+75bp Citigroup/BofA/Credit Agricole/MUFG Aaa/NR/AAA ABS
JONAH 2022–1 US$275 3.09 I–CRV+350bp Guggenheim Securities NR/NR/A– ABS
JONAH 2022–1 US$475 4.63 I–CRV+425bp Guggenheim Securities NR/NR/BBB+ ABS
MFIT 2022–A US$187.277 2.38 I–CRV+260bp Goldman Sachs/Citigroup/Wells Fargo NR/AAA/NR ABS
MFIT 2022–A US$35.671 2.94 I–CRV+325bp Goldman Sachs/Citigroup/Wells Fargo NR/AA–/NR ABS
MFIT 2022–A US$20.333 3.12 I–CRV+400bp Goldman Sachs/Citigroup/Wells Fargo NR/A–/NR ABS
MFIT 2022–A US$22.652 3.27 I–CRV+525bp Goldman Sachs/Citigroup/Wells Fargo NR/BBB–/NR ABS
RMIT 2022–2B US$130.810 2.48 I–CRV+275bp Credit Suisse/Wells Fargo/JP Morgan NR/AAA/NR ABS
RMIT 2022–2B US$52.910 3.34 I–CRV+425bp Credit Suisse/Wells Fargo/JP Morgan NR/A–/NR ABS
SRFC 2022–3 US$96.714 3.32 I–CRV+165bp Credit Suisse/BofA/Deutsche Bank/Barclays NR/AAA/AAA ABS
SRFC 2022–3 US$63.286 3.32 I–CRV+215bp Credit Suisse/BofA/Deutsche Bank/Barclays NR/A/A ABS
SRFC 2022–3 US$63.571 3.32 I–CRV+350bp Credit Suisse/BofA/Deutsche Bank/Barclays NR/BBB/BBB ABS
SRFC 2022–3 US$26.429 3.32 I–CRV+650bp Credit Suisse/BofA/Deutsche Bank/Barclays NR/BB–/BB– ABS
VCL Compartment 37 €945.1 1.30 1mE+55bp SEB/MUFG/Societe Generale NR/AAA/NR ABS
#LASSû"ûTRANCHEûBPûFORûTHEû3INGLEû!û The leads had announced the mandate UCI RETAINS PORTUGUESE
RATEDû#LASSû#ûTRANCHEûBPûFORûTHEû4RIPLEû for Finance Ireland RMBS No. 5 on October RMBS BELEM NO 2
"ûRATEDû#LASSû$ûTRANCHEûANDûBPûFORûTHEû 6 before opening books on Monday. By
$OUBLEû"ûRATEDû#LASSû%û4RANCHEû!LLûFOURû THENûTHEû#LASSû!ûNOTESûWEREûALREADYûû UCI PORTUGAL 5NIAOûDEû#REDITOSû
tranches were priced at cash prices below times covered and initial price thoughts )MOBILIARIOS ûHASûISSUEDûANDûRETAINEDûAû
ûSEEûTABLEûBELOWûFORûDETAILS were set in the area of 100bp. Investors €331.2m STS Portuguese RMBS called BELEM
The initial option holder for the were invited to call desks to inquire about NO 2 through co-arrangers BNP Paribas and
transaction is M&G Investments. Finance the rated mezzanine tranches and the Santander.
Ireland is the risk retention holder. #LASSû8ûNOTES 4HEûTRANSACTIONûISûBACKEDûBYûlRST LIENû
4HEûSOURCEûADDEDûTHATûTHEûlNALûPRICINGûONû 4HEûSUBSCRIPTIONûLEVELûFORûTHEû#LASSû!û residential mortgages granted to
THEû4RIPLEû!ûNOTESûATûBPûOVERû%URIBORûWASû notes had grown to about 1.4 times by INDIVIDUALSûINû0ORTUGALûORIGINATEDûBYû5#)û
a good result for the issuer in the present Wednesday afternoon, when the spread 0ORTUGALûFORûlNANCINGûTHEûPURCHASEûOFû
market conditions. “Pricing Irish resi inside WASûSETûATûBPû4HEûMEZZANINEûTRANCHESû THEIRûlRSTûRESIDENCEûûOWNER
TRIPLEûDIGITSûISûAûSTONKINGûPRINTûFORûMEv were then made subject. OCCUPIED
Another banker at one of the deal’s four Given the jittery market conditions, 5#)û0ORTUGALûISûAûSUBSIDIARYûOFû3PANISHû
joint lead managers, Bank of America the bookrunners had been keen to specialist mortgage lender Union de
ARRANGER ûBNP Paribas, Citigroup and Standard close the books and price the transaction #REDITOSû)NMOBILIARIOSûAûJOINTûVENTUREû
Chartered, said he had seen secondary ahead of the release of the latest US between Santander and BNP Paribas. Late
market covers for similar RMBS paper from consumer price data on Thursday. “We last year, the two banks injected €167m of
Finance Ireland in the low 100s. didn’t want to leave it in the market any fresh capital into the business in the form
“You have all this paper coming out in LONGERûTHANûWEûNEEDEDûTOvûSAIDûTHEû of equity, contingent convertible bonds
secondary and some of it is trading more at banker. and subordinated debt.
AûCASHûPRICEvûHEûSAIDûh)TSûPRODUCINGûQUITEû The transaction is backed by loans 5#)û0ORTUGALûISSUEDûITSûlRSTû2-"3û
spurious secondary levels in terms of your originated by Finance Ireland and PEPPER GreenBelem No 1, in May 2020. That deal
DISCOUNTûMARGINSv FINANCE. Pepper is also the servicer. was also retained.

the notes instead. Initial price thoughts for REMARKETINGûOFû#LASSû!ûNOTESûISSUEDûANDû
EMEA ABS this tranche had been in the low 200s. initially retained in March. The issuer was
Skandinaviska Enskilda BankenûARRANGER û intending to sell at least €400m of the
MIXED FORTUNES IN EUROPEAN ABS MUFG and Societe Generale were joint lead notes.
managers, while Credit Industriel et But after a roadshow took place with
As issuers and investors attempted to Commercial was manager. Credit Agricole acting as arranger and sole
regain their footing in a jittery European 67ûWASûNOTûTHEûONLYûISSUERûTOûOPTûTOû lead manager, the issuer suspended the
securitisation market last week, retain mezzanine notes last week. Bids for transaction, saying it may proceed at a
VOLKSWAGEN LEASING raked in plenty of four rated mezzanine tranches of an Irish later stage if market conditions stabilise.
orders for its German auto ABS senior RMBS from Finance Ireland also failed to There were few signs of that sought-
BONDûOFFERINGûTHOUGHûEFFORTSûTOûlNDûAû meet the reserve price target and were after stability on Friday morning, however,
home for mezzanine paper stalled. retained by the seller. as a securitised products trader told IFR
Demand for the Triple A rated notes of "UTûATûLEASTû67ûANDû&INANCEû)RELANDû that another round of selling was just
67Sû343ûAUTOûLEASEû!"3ûDEALûVCL 37, was so managed to place the senior notes of their getting started in the secondary market. So
strong that the issuer was able to increase trades. The week had started on an while issuers may have been reassured by
the size of the offering by a third, from inauspicious note when CA CONSUMER FINANCE THEûPRICINGûONû6#,SûSENIORûBONDSûTHEû
õMûTOûõMûANDûSTILLûPRICEûITûATû pulled a French auto ABS, citing extreme prospects for more new issuance remain
THEûTIGHTûENDûOFûTHEûlNALûGUIDANCEûRANGEû volatility in the secondary market. uncertain.
55bp over Euribor. The book was about h)TSûDIFlCULTûATûTHEûMOMENTvûSAIDûANû h7EûALWAYSûHAVEûPIPELINEûTOûBRINGûOUTvû
õBNûATûTHEûlNALûSPREADûDOWNûABOUTû ABS trader on hearing that the French auto SAIDûAûSYNDICATEûBANKERûh(OWûWHENûANDûIFû
õMûFROMûlNALûGUIDANCE deal, FCT GINKGO AUTO LOANS 2022, had been we execute will depend on the underlying
4HEûlNALûMARGINûWASûONLYûBPûWIDERû pulled. “Those issuers who are not on the deal and what we’re seeing on screens. It’s
than rival BMW Bank’s Bavarian Sky Auto front row, not the most prominent in the probably the wrong time to start a
Leases 7, which was priced on September market, might get into trouble to place conversation on mezz. For a vanilla,
27, just before the market chaos unleashed NEWûISSUESv funding-only deal, maybe there’s a path to
by the UK’s mini-budget. #!û#ONSUMERû&INANCEûHADûANNOUNCEDû GETTINGûTHINGSûDONEv
!TûTHEûSAMEûTIMEûHOWEVERû67ûCALLEDû the mandate for Ginkgo 2022 in the midst
off a proposed offering of Double A rated of the market chaos triggered by the UK UK CONSUMER LENDER FLURO
mezzanine paper, saying it would retain government’s mini-budget. It was a EYES PUBLIC ABS
GLOBAL SECURITISATIONS IN STERLING SECURITISATIONS – ALL EUROPEAN RMBS FLURO PLATFORM, the UK unsecured
BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE consumer lender formerly known as
Managing No of Total Share Managing No of Total Share Lending Works, could bring a deal to the
bank or group issues £(m) (%) bank or group issues €(m) (%) public ABS market as early as next year
1 Bank of America 9 3,955.65 20.5 after signing a £200m private warehouse
1 Bank of America 10 3,404.12 25.3
2 BNP Paribas 17 2,350.40 12.2 facility with BNP PARIBAS.
2 Barclays 6 1,760.11 13.1
3 Citigroup 13 1,441.99 10.7 3 Citigroup 15 2,073.64 10.7 h4HEûINTENTIONûWOULDûBEûTOûRElNANCEû
4 BNP Paribas 12 1,328.14 9.9 4 Standard Chartered 12 1,608.55 8.3 THROUGHûPUBLICûSECURITISATIONûASû;THEû
5 Standard Chartered 8 923.97 6.9 5 Credit Agricole 2 1,304.00 6.8 PORTFOLIO=ûREACHESûSUFlCIENTûSCALEûBUTû
6 NAB 6 702.47 5.2 6 Barclays 7 1,083.95 5.6 THATSûDEPENDENTûONûMARKETSûATûTHEûTIMEvû
7 Santander 5 700.20 5.2 7 Santander 5 1,020.65 5.3 THEûCOMPANYSûCHIEFûOPERATINGûOFlCERû
8 Lloyds Bank 6 696.63 5.2 8 Natixis 8 839.61 4.3 Jonathan Kramer, told IFR. “Our
9 Natixis 5 464.10 3.4 9 Morgan Stanley 2 838.44 4.3 expectation would be – subject to market
10 NatWest Markets 5 449.08 3.3 10 NAB 6 836.16 4.3 conditions – at some point next year
Total 35 13,470.94 Total 41 19,316.43 LOOKINGûTOûTARGETûPUBLICûMARKETSv
Including Euro, foreign, global and domestics, excluding CDOs. Including Euro, foreign, global and domestics, excluding CDOs Founded in 2014, Fluro extends loans of
Source: Refinitiv SDC code: B16i Source: Refinitiv SDC code: B10a £1,000 to £25,000 with tenors of two to
ALL EUROPEAN ISSUERS GLOBAL STRUCTURED FINANCE IN EUROS ALL INTL ISSUERS (EXCLUDING SELF-FUNDED)
BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE
Managing No of Total Share Managing No of Total Share Managing No of Total Share
bank or group issues US$(m) (%) bank or group issues €(m) (%) bank or group issues US$(m) (%)
1 Bank of America 16 5,557.71 12.6 1 Credit Agricole 8 3,828.68 15.4 1 Bank of America 92 24,330.08 10.9
2 BNP Paribas 27 5,258.50 11.9 2 BNP Paribas 15 3,330.31 13.4 2 Barclays 131 21,434.17 9.6
3 Credit Agricole 8 4,145.86 9.4 3 Societe Generale 9 2,611.62 10.5 3 Credit Suisse 108 18,470.67 8.3
4 Citigroup 22 3,256.53 7.4 4 Santander 5 2,100.47 8.5 4 Citigroup 77 15,836.21 7.1
5 Santander 10 3,060.23 6.9 5 UniCredit 5 1,490.60 6.0 5 Morgan Stanley 75 14,296.61 6.4
6 Barclays 11 3,056.91 6.9 6 Citigroup 9 1,208.92 4.9 6 JP Morgan 68 12,864.63 5.8
7 Societe Generale 11 2,836.23 6.4 7 Banca Akros 2 1,092.05 4.4 7 Goldman Sachs 73 12,341.76 5.5
8 Standard Chartered 12 1,718.37 3.9 8 Bank of America 6 1,090.89 4.4 8 Wells Fargo 54 10,532.55 4.7
9 UniCredit 5 1,568.69 3.5 9 Morgan Stanley 2 838.44 3.4 9 Deutsche Bank 85 10,341.85 4.6
10 Natixis 10 1,349.39 3.0 10 LBBW 2 762.46 3.1 10 Nomura 46 9,806.30 4.4
Total 85 44,244.86 Total 48 24,832.28 Total 463 223,346.98
Includes securitisations, credit-linked notes (Euro, foreign, global and Includes securitisations, credit-linked notes (Euro, foreign, global and Includes securitisations, PFI bonds and credit-linked notes. Excludes US
domestics) and excludes CDOs. domestics) and excludes CDOs. global ABS/MBS, CDOs and self funded issues.
Source: Refinitiv SDC code: B16n Source: Refinitiv SDC code: B16g Source: Refinitiv SDC code: J10d

STRUCTURED FINANCE
lVEûYEARSûTOûPRIMEûANDûNEAR PRIMEû Fluro’s eight-year history and strong ,ATHAMûû#OûANDû3-%ûlNANCEû

consumers. The company was acquired by technology and data put it in a competitive PLATFORMû!SSETZû#APITALû4HEûTHREEû
PRIVATEûEQUITYûlRMû)NTRIVAû#APITALûINûû POSITIONûWHICHûISûREmECTEDûINûITSûABILITYûTOû lenders are expected to contribute loans
before dropping the Lending Works brand RAISEûWAREHOUSEûlNANCING of between £2m and £20m with loan-to-
on September 5 and relaunching as Fluro. h#APITALûISûAVAILABLEûTOûESTABLISHEDû value ratios of up to 75% on UK assets
The rebrand comes alongside a shift in lending businesses that have a track record INCLUDINGûOFlCESûINDUSTRIALûUNITSû
strategy, announced at the end of last year, in terms of being able to manage lending warehouses and retail properties.
away from the company’s roots as a peer- WELLvûHEûSAIDûh)TûSPLITSûTHEûWORLDûMOREûINû 4HEûLOANSûWILLûBEûUSEDûTOûlNANCEû
to-peer lending marketplace and towards two, with businesses like ourselves that ACQUISITIONSûRElNANCEûEXISTINGûDEBTû
PROVIDINGûWHITE LABELûEMBEDDEDûlNANCEû are able to attract funding, and those that and fund upgrades.
backed by institutional capital. Several might struggle. That’s where our track “We are delighted to be working
other peer-to-peer lending platforms, RECORDûISûREALLYûIMPORTANTv with our new partners as we build
NOTABLYû,ENDING#LUBûINûTHEû53ûHAVEûMADEû solutions for investors to access private
similar moves away from the P2P model in CREDITûINûTHEû5+vûSAIDû/UMARû$IALLOû
recent years. EMEA CLO #%/ûOFû!EONûINûAûSTATEMENTûh7ITHû
h7HATûYOUûlNDûINûCOMMONûWITHûALLûOFû the experience and performance of
these companies – and Fluro is the same – AEON SEALS UK CRE CLO OURû#,/ûPLATFORMûWEûBELIEVEûOURû
is that we’ve been able to build out a WAREHOUSE WITH CS disciplined investment approach will
proposition on the borrower side in terms continue to deliver best-in-class returns
of customer acquisition, the ability to AEON INVESTMENTS HASûCLOSEDûAûaMû ûFORûOURûSTAKEHOLDERSûANDûBROADERû#,/û
underwrite and credit decisioning, and COMMERCIALûREALûESTATEû#,/ûWAREHOUSEû INVESTORSv
that means we’ve grown hugely our ability facility with Credit Suisse as it gears up to Aeon is also touting the ESG credentials
to attract borrowers that we want to lend ISSUEûTHREEû5+û#2%û#,/SûOVERûTHEûNEXTûTWOû OFûTHEûPROPOSEDû#,/ûPROGRAMMEû4HEû
TOvûSAIDû+RAMERûh"UTûITSûVERYûDIFlCULTûTOû to three years. company will apply a proprietary positive
scale the retail investor P2P side at the The three-year revolving senior screening methodology based on 13
SAMEûRATEv warehouse facility is backed by strategic equally weighted factors to new loans that
Unsecured consumer credit providers loan agreements Aeon has struck with GOûINTOûTHEû#,/ûPOOLSûANDûWILLûTHENûTRACKû
face an increasingly challenging economic THREEûORIGINATORSûnû#2%ûLENDINGûPLATFORMû their progress against measurable key
environment in the UK, but Kramer says 7AY0ARKû#APITALûPRIVATEûBANKû!RBUTHNOTû performance indicators.
ALL INTL AUSTRALIAN DOLLAR BONDS GLOBAL CDOs ALL EUROMARKET CDOs
bank or group issues A$(m) (%) bank or group issues US$(m) (%) bank or group issues US$(m) (%)
1 Bank of America 27 10,161.70 12.6 1 JP Morgan 22 9,028.58 13.7
1 RBC 34 4,037.79 12.7
2 JP Morgan 24 9,688.76 12.0 2 Jefferies 17 6,792.92 10.3
2 TD Securities 30 3,726.92 11.8
3 Goldman Sachs 21 6,980.01 8.6 3 Goldman Sachs 18 6,399.17 9.7
3 ANZ 18 3,439.29 10.9
4 Jefferies 19 6,953.29 8.6 4 Credit Suisse 15 6,314.38 9.6
4 Nomura 24 3,241.48 10.2
5 Wells Fargo 25 6,542.62 8.1 5 Morgan Stanley 18 5,457.35 8.3
5 CBA 12 2,881.56 9.1
6 Credit Suisse 16 6,477.37 8.0 6 Bank of America 13 5,202.74 7.9
6 JP Morgan 24 2,355.20 7.4
7 Morgan Stanley 21 6,129.61 7.6 7 Barclays 15 4,901.46 7.5
7 Westpac 9 1,881.04 5.9
8 Barclays 16 5,078.18 6.3 8 Citigroup 12 4,620.18 7.0
8 Deutsche Bank 11 1,480.79 4.7
9 Deutsche Bank 12 4,890.39 6.1 9 Wells Fargo 14 3,142.15 4.8
9 Daiwa Securities 16 1,377.00 4.3
10 Citigroup 12 4,620.18 5.7 10 BNP Paribas 8 2,957.32 4.5
10 NAB 8 1,336.98 4.2
Total 171 80,755.31 Total 135 65,768.00
Total 135 31,675.88
Including preferreds. Excluding equity-related debt. Including Euro, foreign, global, US domestics. Excludes global and domestic.
Source: Refinitiv SDC code: K1 Source: Refinitiv SDC code: B12 Source: Refinitiv SDC code: J11
US ASSET-BACKED SECURITIES GLOBAL STRUCTURED FINANCE IN US$ STRUCTURED FINANCE – ALL INTL ISSUERS
bank or group issues US$(m) (%) bank or group issues US$(m) (%) bank or group issues US$(m) (%)
1 JP Morgan 102 28,817.32 10.1 1 JP Morgan 200 74,065.77 11.5 1 Bank of America 92 24,330.08 9.8
2 Bank of America 95 22,991.48 8.1 2 Bank of America 196 65,153.24 10.1 2 Barclays 134 22,109.67 8.9
3 Barclays 87 21,564.98 7.6 3 Citigroup 174 59,501.14 9.2 3 Citigroup 86 20,272.61 8.2
4 Wells Fargo 93 21,115.06 7.4 4 Goldman Sachs 176 58,986.95 9.1 4 Credit Suisse 115 19,594.90 7.9
5 Citigroup 81 20,534.36 7.2 5 Wells Fargo 176 53,001.72 8.2 5 Goldman Sachs 81 16,469.56 6.7
6 RBC 73 18,478.44 6.5 6 Credit Suisse 182 46,702.53 7.2 6 Morgan Stanley 76 14,592.56 5.9
7 Credit Suisse 75 17,796.19 6.2 7 Morgan Stanley 152 43,540.67 6.7 7 JP Morgan 68 12,864.63 5.2
8 Goldman Sachs 62 15,938.89 5.6 8 Barclays 187 39,678.72 6.1 8 Wells Fargo 58 11,963.60 4.8
9 Deutsche Bank 74 13,518.11 4.7 9 Deutsche Bank 124 21,163.66 3.3 9 Deutsche Bank 86 10,524.34 4.3
10 Morgan Stanley 36 10,661.86 3.7 10 Mizuho 57 18,661.94 2.9 10 Nomura 46 9,806.30 4.0
Total 477 284,976.12 Total 1,147 645,912.82 Total 509 247,513.76
Excludes MBS. Including securitisations (Euro, foreign, global and domestics, excluding Includes securitisations, PFI bonds, self-funded issues and credit-linked
CDOs) and PFI bonds. notes. Excludes US global ABS/MBS and CDOs.
Source: Refinitiv SDC code: F14 Source: Refinitiv SDC code: B16b Source: Refinitiv SDC code: J10c

After the operation, which concluded on email statement. The spokesperson
US MBS October 7, Freddie has tendered nearly declined to comment about the timing of
US$8bn of these securities in 2022. possible tenders in 2023.
FREDDIE BUYS BACK US$944m IN CRT The B-1, M-2 and M-3 tranches across Freddie and Fannie Mae launched
eight transactions issued from 2015 to TENDERSûFORûTHEIRû#24ûINûûINûTHEû
Freddie Mac said last Tuesday it purchased ûTHROUGHûTHEû3TRUCTUREDû!GENCYû wake of surging house prices since the
53MûOFûOLDERûCREDITûRISKûTRANSFERû #REDITû2ISKûPROGRAMMEûWEREûELIGIBLEûFORû pandemic began, which has reduced the
securities in its fourth and likely last the cash tender offer. The notes’ original default risks on the mortgages they
tender for these bonds this year PRINCIPALûAMOUNTûTOTALLEDû53BN guarantee.
The second biggest US mortgage BofA Securities and Barclays were the lead (OUSEûPRICEûAPPRECIATIONûBEGANûTOû
lNANCEûAGENCYûPURCHASEDûTHEûSECURITIESû dealer-managers and Academy Securities was slow this spring when the Federal
so it could retire bond issues it no the co-dealer manager. Reserve began raising interest rates, which
longer considers economical as a hedge “At this time, we do not expect to could potentially reduce the attractiveness
against defaults on the mortgages it ANNOUNCEûANOTHERû34!#2ûTENDERûOFFERûTHISû for the two agencies to issue tenders
guarantees. YEARvûAûCOMPANYûSPOKESPERSONûSAIDûINûANû FORû#24û
GLOBAL BOND SUMMARY DETAILS: WEEK ENDING 14/10/2022

Pricing date Issuer Amount Maturity Coupon (%) Reoffer Spread (bp) Yield (%)
SSAR
EUROS
Oct 11 2022 European Union €5bn incr Dec 4 2029 1.625 91.137 MS-21 3.026
(€10bn)
Oct 11 2022 European Union €6bn Nov 4 2042 3.375 99.581 MS+32 3.404
Oct 11 2022 Germany €4bn Aug 15 2053 1.8 88.051 B+2.5 2.349
Oct 12 2022 AFD sustainable €1.2bn Feb 25 2033 3.5 99.434 OAT+55 3.568
Oct 12 2022 CDC sustainable €500m Nov 25 2027 3 99.748 OAT+57 3.053
Oct 13 2022 Brandenburg €200m Oct 20 2042 5 100 6mE+5 -

Oct 13 2022 LB Berlin €250m Apr 20 2027 3 99.734 MS-3 3.067
NON CORE
Oct 11 2022 Victoria A$2.25bn Sep 15 2036 4.75 97.658 EFP+94 4.985
Oct 12 2022 LGFA NZ$600m incr Apr 15 2025 2.75 94.522 MS+28 5.124
(NZ$2.5bn)
Oct 12 2022 LGFA NZ$200m incr Apr 20 2029 1.5 79.688 MS+56 5.219
(NZ$1.66bn)
CORPORATES
EUROS
Oct 11 2022 Vattenfall €500m Apr 18 2024 3.25 99.842 MS+50 3.369
Oct 11 2022 Vattenfall €650m Apr 18 2024 3mE+50 100 3mE+50 -
Oct 11 2022 Vattenfall €500m Oct 18 2026 3.75 99.982 MS+65 3.755
JAPANESE YEN
Oct 14 2022 Thermo Fisher Scientific ¥22.3bn Oct 20 2025 0.853 100 ToMS+70 -

BONDS SUMMARY DETAILS
2022-1,is expected to be rated Aaa/AAA by The Daimler offering drew interest from
US ABS Moody’s and Fitch. The deal also included a INVESTORSûSEEKINGûDIVERSIlCATIONûANDûMOREû
US$178.88m money market tranche, spread than prime auto and credit card ABS,
DAIMLER TRUCK ISSUES FIRST ABS which was retained, a person familiar with the person familiar with the deal said
AFTER ITS SPIN-OFF the deal said. before it priced. Daimler deals’ low levels of
4HEû53Mû#LASSû!ûNOTEûPRICEDûLASTû delinquencies and defaults also appealed to
DAIMLER TRUCKûLASTûWEEKûPRICEDûITSûlRSTû 7EDNESDAYûATû4REASURIESûPLUSûBPûTHEû investors amid growing concerns about
dollar asset-backed offering since being 53Mû#LASSû!ûPAPERûATû4REASURIESûPLUSû credit deterioration, the person said.
spun off from its parent Daimler last BPûANDûTHEû53Mû#LASSû!ûTRANCHEû “This paper is very high-quality and has
December. ATû4REASURIESûPLUSûBPû#LASSû!Sû EXTREMELYûLOWûLOSSESvûANOTHERûPORTFOLIOû
The US$800m deal is supported by loans WEIGHTED AVERAGEûLIFEûISûûYEARSû!ûû manager familiar with the deal said.
on tractors, trucks and trailers originated YEARSûANDû!ûûYEARSûACCORDINGûTOûAû Moody’s projected the cumulative net
FROMûmEETûOPERATORSûINûTHEûTRANSPORTATIONû portfolio manager familiar with the deal. loss for the deal at 1.50%, similar to
and logistics industries. The three-part JP Morgan, Bank of America and SMBC were Daimler’s previous truck ABS issued in
offering, called DAIMLER TRUCKS RETAIL TRUST joint lead underwriters for the deal. 2020.
Pricing steps NIP (bp) Book size Ratings Bookrunners Distribution
MS-20 area, MS-21 2 €16.5bn Aaa/AA+/AAA/NR/ Barc/BofA/DB/JPM/NatWest UK 27%, Fr 15%, RoEur 12%, It 11%,
Scope:AAA Iberia 10%, Ger 7%, Nordics 6%, Switz
6%, Benelux 3%, Asia 3%. Tsy 54%, FM
26%, CB/OI 8%, Ins/PF 5%, Bks 6%,
HF 1%.
MS+34 area, MS+32 2 €27bn Aaa/AA+/AAA/NR/ Barc/BofA/DB/JPM/NatWest Fr 20%, RoW 15%, Ger 13%, RoEur 12%,
Scope:AAA It 9%, Benelux 9%, UK 8%, Iberia 8%,
Nordics 4%, Switz 2%. FM 39%, Tsy 31%,
Ins/PF 18%, Bks 6%, CB/OI 5%, HF 1%.
B+2.5 area, B+2.5 1.5 €5.9bn Aaa/AAA/AAA Barc/BNPP/DB/GS/JPM UK 46%, Neth 23%, Greece 7%, Ger 6%,
Fr 3%, It 2%, RoEur 13%. HF 33%, FM
29%, Bks 20%, CB/OI 10%, Tsy 8%.
OAT+55 area, 15 €1.3bn NR/AA/AA CMZ/CA-CIB/MS/NatWest/SG Fr 40.1%, Benelux 14.2%, Ger/Aus/Switz
OAT+55 12.4%, UK 11.8%, RoEur 9%, N.Amer
8.4%, Asia 4.2%. AM 56.4%, CB/OI
25.8%, Bks/PB 8.7%, Ins 8.4%, Other
0.7%.
OAT+58 area, 30 €775m Aa2/AA/- CA-CIB/JPM/LBP/Natx/NatWest/SG Fr 32.2%, N.Amer 13.4%, Benelux 12.5%,
OAT+57 Asia 12%, Ger 11.3%, UK/Ire 7%, S.Eur
6.6%, Switz 5%. CB/OI 48.5%, Ins
19.3%, Tsy 17.9%, AM 12%, Corp 2.3%
6mE+5 - - -/-/- LBBW -
MS+1 area,MS-2 (+/- 0 €500m Aaa/-/- DZ/NordLB -
1 WPIR),MS-3
EFP+91/+95, - - Aa2/AA/- CBA/DB/NAB/UBS Oz 92%, Asia 3%, UK 2%, Amers 2%, Eur
EFP+94 1%. Bks 58%, AM 34%, Trading 4%, OI
3%, HF 2%.
MS+27/+30, MS+28 - - -/AAA/AA+ ANZ/BNZ/WBC/CBA -
MS+53/+56, MS+56 - - -/AAA/AA+ ANZ/BNZ/WBC/CBA -
MS+70 area, 25 €1bn A3/BBB+/- BNPP/Danske/ING/SG -

MS+50/+55 WPIR,
MS+50
3mE+75 area, 20 €1.2bn A3/BBB+/- BNPP/Danske/ING/SG -
3mE+50/+55 WPIR,
3mE+50
MS+85 area, MS+70 25 €1.4bn A3/BBB+/- BNPP/Danske/ING/SG -
area, MS+65
ToMS+65/+70, - - A3/A-/BBB+ Citi/Miz/MUMSS/SMBCNikko -

ToMS+70, ToMS+70
ToMS+80, ToMS+80
ToMS+90, ToMS+90
ToMS+95, ToMS+95

GLOBAL BOND SUMMARY DETAILS: WEEK ENDING 14/10/2022 (CONTINUED)
NON CORE
Oct 5 2022 Rikshem SKr250m Oct 13 2026 4.533 100 MS+145 4.533
Oct 11 2022 Kraftringen Energi SKr600m Oct 21 2025 3mS+125 100 3mS+125 -
Oct 11 2022 Kraftringen Energi SKr300m Oct 21 2027 3mS+165 100 3mS+165 -
Oct 14 2022 Specialfastigheter Sverige SKr750m Oct 25 2027 3mS+93 100 3mS+93 -
FINANCIALS
EUROS
Oct 11 2022 OP Corporate Bank €500m Apr 18 2027 4.125 99.687 MS+105 4.208
JAPANESE YEN
Oct 14 2022 Societe Generale SNP ¥8.5bn Oct 20 2026 (Oct 2025) 1.553 100 ToMS+140 1.553
Oct 14 2022 Societe Generale SNP ¥6.1bn Oct 20 2028 (Oct 2027) 1.954 100 ToMS+170 1.954
Oct 14 2022 Societe Generale SNP ¥9bn Oct 20 2032 (Oct 2031) 2.289 100 ToMS+180 2.289
Oct 14 2022 Societe Generale T2 ¥10bn Oct 20 2032 (Oct 2027) 3.2 100 - 3.2
NON CORE
Oct 12 2022 Kiwibank NZ$650m Oct 19 2027 5.737 100 MS+110 5.737
Oct 14 2022 Nykredit Realkredit green T2 DKr950m Oct 26 2032 (Oct 2027) 3mC+390 100 3mC+390 -
COVERED BONDS
EUROS
Oct 10 2022 Caffil €1bn Feb 19 2029 3.25 99.995 MS+11 3.26
Oct 11 2022 Belfius Bank €500m Oct 18 2027 3.25 99.991 MS+7 3.252
Oct 11 2022 La Banque Postale €1bn Jan 23 2030 3.25 99.217 MS+13 3.375
Oct 11 2022 LBBW €1bn Oct 18 2024 2.75 99.763 MS-12 2.874
Oct 12 2022 Argenta Spaarbank €500m Oct 20 2026 3.25 99.874 MS+14 3.284
Oct 12 2022 BayernLB green €500m Oct 19 2027 3.125 99.913 MS-3 3.144
Oct 12 2022 CBA €1bn Oct 24 2025 3.246 100 MS+18 3.246
Oct 12 2022 Hypo Vorarlberg Bank €500m Feb 19 2027 3.25 99.84 MS+16 3.293
NON CORE
Oct 11 2022 Suncorp A$200m Oct 17 2025 4.85 99.928 ASW+88 4.876
Oct 11 2022 Suncorp A$550m Oct 17 2025 3mBBSW+88 100 3mBBSW+88 -
Oct 12 2022 Eika Boligkreditt NKr700m Oct 19 2034 4.33 0 - -

Oct 12 2022 Skandiabanken SKr250m incr Sep 24 2025 75 0 - -
(SKr3.15bn)
HIGH YIELD
US DOLLARS
Oct 11 2022 XPO Escrow Sub / RXO US$355m Nov 15 2027 (Nov 2024) 7.5 98.962 T+357 7.75
Oct 12 2022 EnQuest US$305m Nov 1 2027 (Nov 2024) 11.625 98.611 T+780 12

BONDS SUMMARY DETAILS
ToMS+100/+105, - - A3/A-/BBB+/ Citi/Miz/MUMSS/SMBCNikko -

ToMS+105, Egan-Jones Ratings
ToMS+105 Company:A+
ToMS+115, ToMS+115
- - - A3/NR/-/ Danske -
Cicero:2PO
3mS+125 - - NR/A-/- HCM -
3mS+165 - - -/A-/- HCM -
- - - NR/AA+ Danske -
MS+115 area, 40 €750m Aa3/AA-/NR BofA/Barc/OP/SG -

MS+105
ToMS+135/+140, - - Baa2/BBB/A- Daiwa/Miz/MS/Nomura/ -

ToMS+140, SMBCNikko/SG
ToMS+140
ToMS+165/+170, - - Baa2/BBB/A- Daiwa/MS/Nomura/SMBCNikko/SG -
ToMS+170,
ToMS+170
ToMS+175/+180, - - Baa2/BBB/A- Daiwa/Miz/MS/Nomura/ -
ToMS+180, SMBCNikko/SG
ToMS+180
3.2% - - Baa3/BBB-/ Daiwa/Miz/MS/Nomura/ -
BBB/R&I:A- SMBCNikko/SG
MS+110/+120, - - A1/NR/AA WBC/ANZ/BNZ -

revised MS+110,
MS+110
- - - NR/BBB/BBB+ Nykredit -
MS+13 area, MS+11 4 €1.3bn Aaa/AA+/NR/AAA Barc/CMZ/JPM/Santan/SG Ger/Aus 42%, Fr 28%, Benelux 12%, UK/
Ire 8%, It 5%, Nordics 4%, Other 1%. Bks
63%, CB 20%, AM 12%, Ins 5%.
MS+10 area, MS+7 2 €1.25bn NR/AAA/AAA Belfius/CA-CIB/DZ/Erste/Rabo -
MS+15 area, MS+13 4 €1.5bn, 50acs NR/AAA/- Danske/HSBC/LBBW/LBP/Natx/Uni Fr 34%, Ger/Aus 32%, Benelux 13%,
Switz 8%, It 3%, UK/Ire 2%, Other 8%.
Bks/PB 49%, CB/OI 27%, AM/FM 19%,
Ins/PF 5%.
MS-6 area, MS-12 0 €5.1bn Aaa/NR/NR ABN/Citi/DZ/LBBW/Natx -
MS+16 area, MS+14 5 €700m NR/AAA/- Barc/Belfius/LBBW/Natx -
MS+2 area, MS-3 0 €2.4bn, 76acs Aaa/NR/NR BayernLB /Erste/Natx/Santan/SG Ger 73%, Benelux 11%, Nordics 6%, Aus/
Switz 3%, UK 3%, Fr 2%, Other 2%. Bks
64%, AM 23%, CB/OI 12%, Other 1%.
ESG 72%.
MS+20 area, MS+18 6 €1.35bn Aaa/NR/AAA Barc/BNPP/CBA/DB -
MS+18 area, MS+16 7 €750m Aaa/-/- CMZ/Deka/DB/Erste/LBBW -
ASW+93 area, 0 A$525m Aaa/NR/AAA ANZ/CBA/Citi/NAB/RBC Oz/NZ 97.5%, EMEA 2%, Other 0.5%.
ASW+88 AM/Ins 86%, MM 9%, Bks 5%, Other 1%.
3mBBSW+93 area, 0 A$1.15bn Aaa/NR/AAA ANZ/CBA/Citi/NAB/RBC Oz/NZ 88%, EMEA 11%, Other 1%. AM/
3mBBSW+88 area, Ins 38%, Bks 37%, MM 15%, OI 10%.
3mBBSW+88
- - - Aaa/-/- Nordea -
- - - Aaa/NR/NR Nordea -
7.5%/7.75%, - - Ba3/BB+/- BofA/Citi/Barc/GS/Key/MS/Scotia/ -

7.75%/8%, 7.75% WFS/Regions/Truist/USB
12% area, 12.25% - - B3/B+/- BNPP/BofA/DNB/GS/DB -
area (incl some OID),
12%/12.25% (incl
1-2pts OID), 12%

The 2022
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WEDNESDAY NOVEMBER 9, 2022 | CANARY WHARF, LONDON
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morning of Wednesday 9th November 2022 at Level39, Canary Wharf, London.
Hosted by Keith Mullin of KM Capital Markets, this essential annual conference will
consist of four content-rich panels, followed by a networking lunch.
The outline agenda is:

08:30 Registration
09:15 Time to redesign AT1 and the bank capital stack?
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11:10 Focus on residual and emerging EU regulatory and supervisory matters
11:50 New capital markets pricing paradigm
12:30 Networking lunch
13:30 Close
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EMERGING MARKETS China 42 Philippines 42 Chad 43 Georgia 44 Nigeria 44 Slovakia 44
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FRONT STORY ASIA
Greenko funds clean power storage

Renewable company eyes mix of debt and equity to build storage facilities
High cost of dollar funding means local means more likely
GREENKO GROUP plans to raise US$4.5bn from a funding,” said Kaipa, as offshore investors invest less than 10% equity in Greenko
mix of equity and debt to build storage are reluctant to invest in US dollar bonds Holdco,” Kaipa said.
facilities for renewable energy in India, key because of the uncertainty over rates while It would take around three months for the
infrastructure that the country will need to the US Federal Reserve remains hawkish. "ROOKlELDûDEALûTOûBEûWRAPPEDûUPûANDûTHEû
meet its ambitious climate goals. “We have received in-principle approval proceeds may be used for general purposes
The board of the country’s largest from the board to raise a US$750m rather than solely for pumped storage
renewable energy company has approved the AMORTISINGûLOANûFROMû2URALû%LECTRIlCATIONû projects, according to a credit note by
planned capital expenditure over the next Corp for our Madhya Pradesh project under Nomura on October 6. It may use the
three years, and Greenko has received equity construction for a tenor of 12–14 years at proceeds from the equity injection to repay
commitments in excess of US$1.3bn from its around a 10% interest rate,” he said. The loan dollar bonds due in February or it may rely
major stakeholders – Singapore’s GIC, Abu will be sanctioned in the next 40–45 days. on onshore banks for loans, it said.
Dhabi Investment Authority and Japan’s Orix. Greenko is tilting towards rupee loans Greenko Energy Holdings (Mauritius) has
It is focusing on energy transition and because external commercial borrowings US$435m of 6.25% bonds due in February
building long-duration energy storage of 50 have become more expensive. Moreover, next year and US$500m of 4.875% bonds
gigawatt hours at its four renewable projects “local currency debt is negligible in maturing in August 2023. Both have a call
in the states of Andhra Pradesh, Karnataka, Greenko’s operating companies, as the option in November.
Rajasthan and Madhya Pradesh by the 2025 entire debt is in the dollar market, therefore 4HEûCOMPANYûISûALSOûREAPINGûTHEûBENElTSû
CALENDARûYEARûCHIEFûlNANCIALûOFlCERû there is no challenge for Greenko to get of the Late Payment Surcharge scheme
Vasudeva Rao Kaipa said. funding from the domestic market,” said announced by the government on May 25.
'REENKOûWHICHûHASûAûDIVERSIlEDûPORTFOLIOû Kaipa. This allows state-run electricity distribution
of wind, solar, hydro and pumped storage, Other renewable companies have COMPANIESûORûDISCOMSûTOûPAYûTHEIRûlNANCIALû
currently has operating capacity of 7.5GW. successfully tapped the rupee loan market at dues in instalments across 12–48 months,
“Unless there is a storage facility that attractive rates. In August, ReNew Power starting from June this year. The utilities can
supplies renewable power 24 hours, seven obtained a Rs15.5bn (US$188m) bilateral also enjoy a one-time relaxation of principal
days a week, it will not be possible for the LOANûFROMû!XISû"ANKûTOûlNANCEûTHEû and late payment surcharges under the
grid to function properly,” especially for development of solar cell and module scheme.
peak hour requirements, Kaipa said. manufacturing facilities. In July, ReNew Kaipa believes that the scheme will work
India’s renewable companies are unable to Energy Global managed to raise amortising because “if the discoms don’t pay on time
meet peak power demand, especially in the project debt from REC at close to 9% for [under the LPS scheme], they are not eligible
summer months and in the evenings, three years to redeem US$525m of notes at a to buy power through the exchanges,” he
forcing power companies to resort to coal to lower cost than in the offshore market. said.
meet supply shortfalls in the absence of Ample liquidity in the rupee bank loan The weak state-run discoms, particularly
renewable storage facilities. market and attractive funding rates (around in the southern state of Andhra Pradesh,
The government plans to build 500GW of 8%–9% for operational assets and 10%–13% have started clearing their outstanding dues
renewable energy capacity by 2030 from for under construction assets or holdco with monthly payments of around US$20m,
100GW currently and achieve net-zero borrowings) have allowed companies like which will reduce Greenko’s large
carbon emissions by 2070, which it outlined Greenko and Renew to raise sizable rupee receivables, said S&P in a note on October 5.
during the COP26 climate conference in funds recently for growth capex, as well as As a result the ratings agency upgraded
November last year. RElNANCEûAPPROACHINGûDOLLARûDEBTû Greenko Energy Holdings’ long-term issuer
maturities, said Abhishek Dangra, senior credit rating and the senior secured notes,
RUPEE LOANS director at S&P. which the company guarantees to BB–
Greenko is also planning to raise US$3.2bn from B+.
from debt. In March, Greenko Wind Projects EQUITY INVESTMENT Moreover, there has been a change in
(Mauritius), rated Ba1/BB (Moody’s/Fitch), 3EPARATELYû"ROOKlELDû!SSETû-ANAGEMENTû sentiment towards India’s renewable sector.
sold US$750m three-year non-call two green has expressed interest to invest around h4HEû)NDIANûlNANCIALûINSTITUTIONSûAREû
bonds at par to yield 5.5%. US$1bn in Greenko at the holdco level, willing to take a bet on the sector on the
The balance of US$2.45bn will come from ACCORDINGûTOû+AIPAû"ROOKlELDûDECLINEDûTOû BACKûOFûTHEûVISIBILITYûOFûLONG TERMûCASHmOWSû
LOANSûMOSTLYûFROMûDOMESTICûlNANCIALû comment. payment clarity and the upholding of power
institutions. h7EûAREûEVALUATINGû"ROOKlELDSû purchase agreements,” said Kaipa.
“In the current market scenario, we don’t investment at the right valuation. GIC’s 51% Krishna Merchant
see a challenge in getting the domestic STAKEûWILLûBEûRETAINEDûANDû"ROOKlELDûMAYû Additional reporting by Mirzaan Jamwal

Syngenta (Baa1/BBB+/A) had targeted an Syngenta Group is indirectly owned by
issue size of US$500m from the start. It the State-owned Assets Supervision and
ASIA-PACIFIC priced the bonds at Treasuries plus 80bp, Administration Commission. It is wholly
much tighter than initial guidance of owned by ChemChina, which is 100%-
125bp, thanks to a book that was over owned by Sinochem, which in turn is
CHINA 53BNûWHENûlNALûGUIDANCEûATûBPûWASû owned by the central government. The
RELEASEDû4HEûlNALûDISTRIBUTIONûDATAûWEREû ownership implies strong support from
SYNGENTA FINDS FERTILE PRC DEMAND not disclosed, but some US$1.041bn of the the government given Syngenta Group’s
BOOKûATûlNALûPRICEûGUIDANCEûCAMEûFROMûTHEû strategic role in the country’s food
Chinese-owned seeds and pesticides maker lead managers. security.
SYNGENTA GROUP raised US$500m from a 3.5- Chinese banks provided the bulk of Bank of China, Citigroup and HSBC were
year bond offering in the face of rough support, as the tight pricing was the global coordinators.
markets and the threat of potential US unappealing to international investors,
sanctions against its parent company. said a second banker on the deal.
The issuer, which was acquired by China “The issuer is owned by ChemChina so PHILIPPINES
National Chemical Corp in 2017, was the there is a state-owned enterprise angle
lone Asian issuer to brave the US dollar which meant that Chinese banks will take ICTSI USES LM TO RIDE OUT STORM
market on Wednesday. Its deal came in the the deal since they have more lines to it,”
wake of news that the US Defense SAIDûTHEûlRSTûBANKERû INTERNATIONAL CONTAINER TERMINAL SERVICES’
Department had added ChemChina to its %VENûSOû3YNGENTAûAûPROLIlCûBONDûISSUERû liability management exercises in recent
annual Communist Chinese Military under its previous Swiss ownership, priced years have guaranteed smooth sailing for
Companies list in a tranche two category, well inside other Chinese state-owned the container port operator throughout
which means it is not subject to US enterprises such as Sinochem, whose the pandemic.
sanctions for now but could face action in 2025s were at a spread of 117bp on ICTSI decided to tackle its debts, taking
the future. Wednesday, while China Merchant Port out some of its more costly long-term
Some international investors raised Holdings’ 2027s were at 98bp. bonds. “We were a bit over capitalised, too
concerns during roadshows about the CreditSights said Syngenta’s new bonds much equity compared with what we
potential effect of the US move, but the were “fully priced” at 80bp over Treasuries. needed,” said Rafael Jose Consing, ICTSI’s
issuer and its leads ruled out any impact, The notes were nominally quoted at CHIEFûlNANCIALûOFlCER
pointing out that the CCMC list did not 110bp–120bp in the secondary market on The Philippine company’s move also
include Syngenta. Thursday, but bankers on the deal said helped ensure its balance sheet has the
h!FTERûTHEûCLARIlCATIONûINVESTORSû there was no liquidity and no trade in the capacity to take on debt should global
understood that there were no sanctions paper. trade weaken, or if any M&A opportunities
against ChemChina and the issue was not 4HEûISSUERûHADûINDICATEDûAûlVE YEARû arise. ICTSI has been acquisition-hungry,
SPECIlCûTOû3YNGENTAvûSAIDûAûBANKERûONûTHEû tenor during roadshows but abandoned it most recently buying a majority stake in
deal. after deciding it would have been too an Indonesian port this year.
Analysts, however, are concerned about expensive. The company’s decision to manage its
a possible impact in the future. 4HEûlXED RATEûSENIORûUNSECUREDûû debt proved fortuitous, as the pandemic hit
“We do not rule out the likelihood of notes, to be rated Baa1/BBB+/A, priced at in 2020 and disrupted shipping. Global
further trade frictions or an update in the 99.544 for a yield of 5.144%. maritime trade was down 3.8% in 2020,
military sanction list to have a negative Syngenta Group Finance is the issuer of with an increase of more than 3% in 2021,
IMPACTûONû3YNGENTASûCOMPANYûPROlLEûORû the notes, which will be guaranteed by according to the United Nations Conference
bond holding structure,” said Nomura’s Syngenta Group. There will be a change of on Trade and Development. ICTSI saw
credit analysts, who found the initial control event with a put option at 101. VOLUMESûSTAYûROUGHLYûmATûINû
guidance on the deal unattractive even Proceeds will be used for general corporate “We were washing out maturities and at
before the price tightening. needs, including debt repayment. the same time rebuilding the capital
ALL INTL EMERGING MARKETS BONDS ALL INTL EMERGING MARKETS BONDS INTERNATIONAL ISLAMIC FINANCE DEBT
Asia-Pacific Managing No of Total Share Managing No of Total Share
Managing No of Total Share bank or group issues US$(m) (%) bank or group issues US$(m) (%)
bank or group issues US$(m) (%)
1 Citigroup 131 25,744.31 8.6 1 HSBC 9 3,145.34 17.2
1 HSBC 125 12,112.68 6.9
2 JP Morgan 110 22,633.47 7.6 2 Dubai Islamic Bank 10 2,744.22 15.0
2 Citigroup 81 10,161.69 5.8
3 HSBC 154 19,408.63 6.5 3 Citigroup 5 1,705.05 9.3
3 Standard Chartered 99 9,738.32 5.6
4 BNP Paribas 80 12,262.35 4.1 4 Standard Chartered 10 1,629.05 8.9
4 JP Morgan 52 8,492.05 4.9
5 Standard Chartered 115 11,248.80 3.8 5 Kuwait Finance 6 1,150.88 6.3
5 Credit Agricole 97 7,032.88 4.0
6 Bank of America 70 10,581.21 3.6 6 Emirates NBD 8 1,057.72 5.8
6 BNP Paribas 55 6,320.19 3.6
7 Deutsche Bank 46 9,283.16 3.1 7 Deutsche Bank 3 949.61 5.2
7 Bank of America 46 5,569.00 3.2
8 Credit Agricole 104 8,318.71 2.8 8 Gulf Finance House 1 900.00 4.9
8 Bank of China 109 5,132.55 2.9
9 Goldman Sachs 37 8,000.26 2.7 9 Saudi National Bank 4 884.74 4.8
9 Mizuho 61 4,956.76 2.8
10 Societe Generale 53 7,686.56 2.6 10 CIMB Grp Hldgs Bhd 1 650.00 3.5
10 Citic 159 4,582.93 2.6
Total 682 297,916.34 Total 16 18,335.80
Total 524 174,744.69
Excluding equity-related debt. Excluding equity-related debt.
Excluding equity-related debt.
Source: Refinitiv SDC code: L4 Source: Refinitiv SDC code: L1 Source: Refinitiv SDC code: J27

EMERGING MARKETS EUROPE/AFRICA
structure with longer debt,” said Consing. At the end of the second quarter, ICTSI experts say both government and private
“It just so happened that the pandemic hit had US$76.57m in total interest expenses sector creditors must be ready to act in
us at a time when we were already and cumulative distribution for its case debt servicing conditions become
deleveraging.” interest-bearing debt and perps. As of the MOREûDIFlCULTûFORûTHEûCOUNTRY
ICTSI made a tender offer for a 5.5% lRSTûHALFûOFûûITûHADû53M That could happen in 2024, the source
perpetual note issue in 2020, and more said, when Chad will face a high level of
recently in November 2021, another debt service payments.
tender for US$183.762m of its US$400m of Chad’s creditor committee, co-chaired
5.875% senior guaranteed perpetual issue by France and Saudi Arabia, met virtually
and US$85.222m of its US$375m 4.875% EUROPE/AFRICA on September 13 and 27, together with
perp. At the same time, it sold a US$300m staff from the International Monetary
of 3.5% 10-year bonds at par. Fund and the World Bank.
“In the company’s perspective it was a CHAD .OûDEBTûRELIEFûFROMûOFlCIALûBILATERALû
cost saving,” said a banker close to the creditors was currently needed given the
deal. “They effectively pushed out the CREDITORS SAY COUNTRY DOES surge in oil prices since the approval of an
maturity by a few years. They were pretty NOT NEED DEBT RELIEF IMF lending programme on December 10,
happy to move from some of those perps, the committee said. However, it agreed to
which tend to be more illiquid.” CHAD’s creditors on Thursday said they had reconvene if needed.
The timing of the tender and new agreed that the African country did not “The creditor committee committed to
money offer proved perfect, as investors need debt relief at the moment given a reconvene and address the need for a debt
were still comfortable with longer tenors surge in oil prices, but committed to TREATMENTûIFûAûlNANCINGûGAPûISûIDENTIlEDvû
at the time. Such a deal would be less likely RECONVENEûIFûAûlNANCINGûGAPûWASû it said, adding that Chadian authorities
to succeed this year as the sweet spot for IDENTIlEDû2EUTERSûREPORTED would be expected to seek comparable
new bond tenors would be closer to three In a statement released by the Paris Club debt treatments from all private and other
years, said the banker. OFûOFlCIALûCREDITORSû#HADSûCREDITORSûSAIDû OFlCIALûBILATERALûCREDITORSûSHOULDûONEûBEû
“This is one of the better and sought- THEYûWEREûlNALISINGûAûMEMORANDUMûOFû needed.
after names from the Philippines,” he said. understanding on a deal, which marks the It also urged Glencore, Chad’s largest
“They have been doing bonds for quite a outcome under a debt treatment PRIVATEûEXTERNALûCREDITORûhTOûREAFlRMûITSû
few years now. It is one of the key names framework agreed by the Group of 20 commitment to provide a debt treatment
from the region.” major economies and the Paris Club in late during the IMF programme should a
ICTSI plans to continue its deleveraging 2020. lNANCINGûGAPûBEûIDENTIlEDvûANDûTOûADDRESSû
over the next few years. Assuming the Together with Ethiopia and Zambia, the remaining debt vulnerabilities that result
company does not make any large Chad was one of three initial countries to from its acceleration repayment mechanism.
acquisitions, it should be net cash positive seek a debt restructuring under a G20 A spokesperson for Glencore declined to
by 2026, said Consing. initiative, but progress has been glacial. comment.
But the movement in rates globally will The deal makes clear that Chad’s #HADSûlNANCEûMINISTERûWELCOMEDûTHEû
hold ICTSI back from doing any more liability bilateral creditors – China, France, India cooperation with the G20, Paris Club and
management exercises in the near future. and Saudi Arabia – would act to offer Chad )-&ûDURINGûAûMEETINGûOFû!FRICANûlNANCEû
“Rates have already gone up, and the carrying debt relief if needed, a source familiar with MINISTERSûANDû'ROUPûOFû3EVENûOFlCIALSûONû
coupons of these bonds that we have are the matter told Reuters. Wednesday, the source said.
quite low,” said Consing. The company has The agreement also includes The source said discussions were
about US$2bn of outstanding bonds, Switzerland-based mining and commodity continuing with ZAMBIAûWHOSEûlNANCEû
including a US$400m 4.625% note issue due in lRMû'LENCOREûAûMAJORûCREDITORûWHICHûWASû minister also participated in the G7
*ANUARYûACCORDINGûTOû2ElNITIVûDATA seen as a “huge step”, said the source. MEETINGûWITHû!FRICANûlNANCEûMINISTERSûANû
Consing believes the market has not yet !LTHOUGHû#HADûISûCURRENTLYûBENElTINGû event coordinated by current G7 president
SEENûTHEûPEAKûOFûINmATIONûASûLENDERSûAREû from high oil prices, economists and Germany.
LOOKINGûATûSHORTER TERMûlNANCINGûATûHIGHERû
rates. ALL INTL EMERGING MARKETS BONDS ALL INTL EMERGING MARKETS BONDS
Still, ICTSI feels it is on stable footing BOOKRUNNERS: 1/1/2022 TO DATE BOOKRUNNERS: 1/1/2022 TO DATE
going into the end of the year. Europe/Africa Middle East
“The company has navigated itself Managing No of Total Share Managing No of Total Share
through the pandemic very well,” said bank or group issues US$(m) (%) bank or group issues US$(m) (%)
#ONSINGûh7EûHAVEûAûSIGNIlCANTLYûSTRONGERû 1 Citigroup 24 8,349.31 16.3 1 HSBC 19 3,100.81 11.5
balance sheet now than when we entered 2 JP Morgan 24 6,265.07 12.3 2 Standard Chartered 16 2,100.34 7.8
the pandemic.” 3 Deutsche Bank 10 4,340.86 8.5 3 Citigroup 10 1,923.81 7.1
ICTSI reported in August that its revenues 4 BNP Paribas 13 3,960.06 7.8 4 JP Morgan 12 1,844.83 6.9
FROMûGLOBALûPORTûOPERATIONSûINûTHEûlRSTûHALFû 5 Goldman Sachs 10 3,942.88 7.7 5 First Abu Dhabi Bk 11 1,340.08 5.0
of 2022 reached US$1.06bn, a 20% increase 6 HSBC 9 2,979.46 5.8 6 Barclays 6 1,147.64 4.3
year-on-year. The company reported 7 Erste Group 15 2,572.26 5.0 7 Robert W Baird 5 979.12 3.6
revenues of US$1.51bn for all of 2020. 8 ING 7 1,967.97 3.9 =7 Cantor Fitzgerald 5 979.12 3.6
%BITDAûWASû53MûINûTHEûlRSTûHALFû 9 Societe Generale 10 1,927.91 3.8 9 Credit Suisse 5 977.78 3.6
showing 26% annual growth. 10 Dubai Islamic Bank 2 1,375.00 2.7 10 Saudi National Bank 4 879.53 3.3
The borrower’s asset to liability ratio Total 55 51,088.76 Total 48 26,915.89
dropped to 0.69 at the end of June from Excluding equity-related debt. Excluding equity-related debt.
1.81 at the end of December 2021. Source: Refinitiv SDC code: L2 Source: Refinitiv SDC code: L5

GLOBAL EMERGING MARKETS BOND DETAILS: WEEK ENDING 14/10/2022
ASIA
Oct 12 2022 Syngenta Group Co US$500m Apr 19 2026 5 99.544 T+80 5.144
Oct 11 2022 Yancheng Oriental US$164m incr Sep 28 2025 7 99.995 - 7

Investment (US$394m)
Oct 12 2022 Liupanshui Minsheng US$100m Oct 12 2023 6.4 100 - 6.4
Industrial Investment Group
Oct 14 2022 Shinhan Bank ¥14bn Oct 18 2024 0.87 100 ToMS+77 -
Oct 14 2022 Shinhan Bank ¥11.5bn Oct 20 2025 0.98 100 ToMS+82 -
Oct 14 2022 Shinhan Bank ¥6.5bn Oct 20 2027 1.33 100 ToMS+107 -
EMEA
Oct 12 2022 Slovak Republic €1bn Oct 19 2032 4 99.322 MS+70 4.084
LATAM
Oct 11 2022 LATAM Airlines Group US$450m Oct 15 2027 (Oct 2024) 13.375 94.423 T+1085 15
Oct 11 2022 LATAM Airlines Group US$700m Oct 15 2029 (Oct 2025) 13.375 93.103 T+1094 15
The cost of servicing that debt surpassed The reoffer yield was 4.084%. “It does not
GEORGIA REVENUESûINûTHEûlRSTûFOURûMONTHSûOFûTHISû look overly attractive even though it seems
year, worrying many observers. to be priced above the local euro-
GEORGIA CAPITAL SOAKS UP MATURITY Nigeria’s international dollar bonds had denominated yield curve,” said Kasparas
suffered sharp declines in recent days, Subacius, fund manager at CEE investment
GEORGIA CAPITAL is looking at buying back with longer-dated issues dropping more lRMû).6,û!SSETû-ANAGEMENTûWHOû
some of its 2024 notes to reduce debt on its than 2 cents in the dollar on Thursday, compared the offering with a €1bn 10-year
balance sheet. MarketAxess data showed. from the higher rated Estonia (A1/AA–) the
This issuer is seeking to buy back US$60m Many of the country’s bonds trade in previous week.
of its US$365m 6.125% notes issue due 2024 distressed territory below 70 cents in the “Estonia has the lowest public debt to
through cash, as it works to deleverage its dollar with the 2047 bond being bid at 55 GDP ratio in the European Union – less
balance sheet after it said its liquidity cents. THANûûnûANDûTHEûlSCALûDElCITûISûVERYû
position had been improved by the sale of an moderate. Slovakia, on the other hand, has
80% stake in its water utility business. higher leverage with public debt standing
The purchase price has been set in a SLOVAKIA ATûûASûOFûTHEûENDûOFûûANDûTHEûlSCALû
range of between 88 and 95. The bonds are balance is more strained. However, in the
quoted at 92.75–94.61, according to Trade. SOVEREIGN RACES THROUGH bond market Estonia’s 2032 issue seems to
JP Morgan is dealer-manager. THE GEARS be trading at a yield of around 4.2%.
Therefore, Slovakia’s 4% does not seem so
SLOVAKIA made swift work of a €1bn inspiring.”
NIGERIA 10-year bond on Wednesday, shutting Both Slovakia and Estonia are at the
up books within three hours of their forefront of Vladimir Putin’s energy war
DMO RULES OUT DEBT opening but still seeing demand almost with Europe and are suffering from high
RESTRUCTURING reach €4bn. INmATIONûTHOUGHûTHEûRATEûINû3LOVAKIAûATû
The sovereign, rated A2/A+/A, set the over 13%, is much lower than that in
NIGERIA is not restructuring its debt, the spread at swaps plus 70bp, which was 15bp Estonia.
COUNTRYSû$EBTû-ANAGEMENTû/FlCEûSAIDûINû inside guidance. Bankers put the new issue The energy crisis is also affecting the
a statement on Thursday, Reuters reported. premium at 20bp–25bp, in a sign that the country’s GDP. Last month Fitch, in
The country is exploring bond buy-back days of low single-digit concessions or lowering its 2023 GDP growth projections
and bond exchanges to manage its debt PRINTSûmATûTOûTHEûCURVEûWEREûFADINGûFROMû across the CEE and Balkans, made its
LIABILITYûTHEûOFlCEûSAIDûINûTHEûSTATEMENTû memory. largest cuts to Slovakia and the Czech
and it assured investors and creditors that “When you are looking at credit, then 2EPUBLICûhSOVEREIGNSûWEûHADûIDENTIlEDûASû
it would “meet all its debt obligations”. you have names like OP Corporate Bank, being most exposed to a shutdown of
Instead, the DMO said Nigeria is which is Double A rated and one of Russian gas imports to the EU, which is
spreading out debt maturities and Finland’s biggest lenders, doing a €500m now our baseline assumption”.
RElNANCINGûSHORT TERMûDEBTûUSINGûLONG senior preferred, and they are getting a The lead said “this was a bit more liquid
term debt instruments. €750m book and paying a 30bp than some of the smaller trades we’ve
Nigeria’s total public debt rose 3% to concession,” said a lead. “Credit per se is been seeing from the Baltics”. He added
US$103.3bn in the second quarter of this DIFlCULTûANDûTHEûNEWûISSUEûPREMIUMSûAREû that the investor composition was made
year, driven largely by burdensome fuel higher. For CEE sovereigns you need to up of domestic treasuries and asset
subsidies and falling oil revenues due to provide a decent concession or the trade managers, international treasuries and a
crude theft. just doesn’t work.” few international asset managers.

EMERGING MARKETS EUROPE/AFRICA
T+125 area, T+80 - US$1.2bn Baa1/BBB+/A BoC/Citi/HSBC/ABChina/ANZ/ -

(the #) BoCom/CCBA/CICC/CMBCHK/DBS/
ICBCA/JPM/MS/StCh/Luso
7% (the #) - - -/-/- Guotai Junan/CICC/Caitong -
International/CISI/JQ Sec/Zheshang/
IndustrialHK/RealordAPS
6.4% - - -/-/- Carlyon/Shenwan Hongyuan/Haitong -
Intl/CITIC
ToMS+77 - - Aa3/-/-/JCR:AA MUMSS/Miz/Nomura -
MS+85 area, MS+70 25 €3.9bn A2/A+/A Citi/JPM/SloSpo/Tatra -
Cpn 13%/13.25%, - - B2/BB+/- JPM/GS/Barc/BNPP/Natx -

13.375%, 13.375%
Cpn 13%/13.25%, - - B2/B+/- JPM/GS/Barc/BNPP/Natx -
13.375%, 13.375%
Further CEE sovereign supply could be The outstanding Tier 2 has a one-time
on its way, with talk around the likes of TURKEY call coming up on November 24 this year,
Latvia and Lithuania. and the bank said it did not intend to
“The number of issuers is perhaps FIBABANKA STRIVES TO KEEP exercise it.
more than you would think although INVESTORS ENGAGED “Tier 2s can create a two-way problem,
it is not incredible,” said the lead. “But where on one side the issuer has an
the question is whether all will have Turkey’s FIBABANKA is hoping to stay on the amortising Tier 2, while investors would
access.” right side of investors by inviting holders BEûSTUCKûWITHûTHEûINSTRUMENTûFORûlVEûMOREû
Citigroup, JP Morgan, Slovenska sporitelna of its Tier 2 notes due 2027 to switch into a years as there is no regular call,” said the
(Erste Group) and Tatra banka (Raiffeisen Bank new US dollar Tier 2 maturing in 2033 and dealer manager.
International Group) were lead managers and callable from 2027. “Fibabanka had a comfortable total
bookrunners. The exchange is targeting up to US$75m capital adequacy position at 24% in the
of the existing US$300m 7.75% bonds. The second quarter of 2022, and even with an
bank already holds just under US$62m in amortising Tier 2, on a pro forma basis it
SOUTH AFRICA nominal amount of the bonds, and those would be 1.5%–2% lower, but still offer
notes are excluded from the exchange. SUFlCIENTûHEADROOMûOVERûTHEûMINIMUMû
SAPPI EATS INTO 2026s “The incentive and rationale for each capital requirements.”
issuer behind an exchange offer differs, The exchange offer deadline falls on
South African paper company SAPPI has but these kinds of offers are structured to October 20.
accepted a touch under €210m of its let issuers keep fully recognised Tier 2 Nomura and Standard Chartered are the
3.125% senior notes due 2026 for a capital and also keep investors happy dealer managers.
buyback. given there is a very low likelihood of a call
The purchase is being completed with with the market in this state,” said one of
cash, and the buyback size is above the the dealer managers on the exchange. UKRAINE
company’s initial target of €150m. “This offer gives investors a one
Sappi was taking advantage of the bond percentage point upside for showing some OSCHADBANK CLEARS CONSENTS
trading below par, using its strong cash faith and loyalty to the credit, which will
balance position to decrease its overall help when the market conditions are such Ukrainian state-owned OSCHADBANK has
level of gross debt. that the issuer would like to access them.” successfully passed its consent solicitations
The purchase spread offered was The exchange offer is on a par for par in regards to its 2023s and 2025 issues. The
swaps plus 250bp. The bonds were quoted basis, with the coupon based on an process had been delayed after the
around 350bp the day before the tender aggregate of the initial CMT rate and the resolution was initially passed in regards
offer was announced, according to new notes margin. The minimum new to its 2023s but the meeting for the 2025s
Tradeweb. NOTESûMARGINûWILLûBEûûANDûTHEûlVE was inquorate and had to be adjourned.
“Every euro we purchase now is a euro year US Treasury yield on Friday was Unlike the sovereign and some other
WEûDONTûHAVEûTOûRElNANCEvûSAIDû*ORGû around 4.18%. state-owned entities, which also made
Passler, group treasurer at Sappi, had told The existing notes have a reset rate of consent offers to their bondholders
IFR, adding that a much higher coupon lVE YEARûDOLLARûMID SWAPSûQUOTEDûATûû recently, Oschad had not been seeking a
would have been needed to replace the on Friday, plus 5.758%. The bonds were bid debt deferral.
bond targeted in the offer. at a cash price of around 90 ahead of the Instead, it was requesting a temporary
ING and JP Morgan were dealer exchange offer announcement, before suspension of the application of a clause
managers. climbing to about 92.50. on the maintenance of capital adequacy

and event of default waivers on its The US$1.15bn two-part senior secured ALL INTL EMERGING MARKETS BONDS
US$700m of 9.375% amortising notes due BONDûOFFERINGûINCLUDEDûAû53MûlVE BOOKRUNNERS: 1/1/2022 TO DATE
2023 and US$500m of 9.625% amortising year non-call two note tranche priced with Latin America
notes due 2025. a 13.375% coupon at 94.423 to yield 15% Managing No of Total Share
Any default event “may have arisen or and a US$700m seven-year non-call three bank or group issues US$(m) (%)
may arise” because of a failure by the bank note tranche priced with a 13.375% coupon 1 JP Morgan 21 6,679.92 14.6
to maintain the minimum level of capital at 93.103 to yield 15%. 2 Citigroup 16 6,051.82 13.2
adequacy required; failure of the bank to Initial price talk on the B2/B+ rated 3 Bank of America 16 3,985.10 8.7
deliver to the lender and the trustee the bonds was in the 13% to 13.25% area when 4 Santander 9 3,519.47 7.7
BANKSûAUDITEDûlNANCIALûSTATEMENTSûFORûTHEû the deal was announced on September 22. 5 Barclays 8 3,447.10 7.5
lNANCIALûYEARûENDEDû$ECEMBERûûû It was originally expected to be priced in 6 BBVA 5 2,605.95 5.7
within 180 days as required; or not making the week of October 3. 7 Scotiabank 10 2,425.73 5.3
its 2022 dividend payment, which was due The Chile-based airline company 8 Goldman Sachs 10 2,124.50 4.6
on March 4 but is still expected pending DOWNSIZEDûTHEûlVE YEARûNOTEûTRANCHEûBYû 9 Mizuho 9 1,344.94 2.9
THEûlNALISATIONûOFûTHEûBANKSûAUDITEDû US$300m and the seven-year tranche by 10 BNP Paribas 7 1,344.87 2.9
results. US$50m in favour of upsizing its term loan Total 49 45,772.35
JP Morgan was solicitation agent. B to US$1.1bn. Excluding equity-related debt.
Though the deal was marketed to a Source: Refinitiv SDC code: L3
broad range of investors, including US real

money accounts active in airlines, credit In assigning a B+ rating to LATAM
opportunity funds, hedge funds and EM Airlines’ proposed notes in September, S&P
AMERICAS investors, those interested ended up being said it expected its “operations to continue
mostly investors that are very active in the recovering in the next two years”.
high-yield market, a banker working on S&P forecast LATAM Airlines’ debt to
CHILE the deal said. Ebitda ratio to be about 5x and funds from
After being in Chapter 11 bankruptcy operations to debt at around 10% by the
LATAM AIRLINES’ DOWNSIZED BOND protection proceedings since early 2020 when end of 2023, saying it “will emerge from
SEES LIGHT OF DAY THEûPANDEMICûlRSTûHITûONû*UNEûûTHEûAIRLINEû bankruptcy with a comfortable liquidity
said it had obtained debt commitment letters position”.
LATAM AIRLINES priced a downsized US$1.15bn FORûEXITûlNANCINGûTHATûINCLUDEDûNEWûDEBTûOFû JP Morgan was lead-left on the bonds
high-yield bond issue on Tuesday to repay US$2.25bn and a new revolving credit facility while Goldman Sachs was left lead for the
its existing debtor-in possession loans as it of US$500m. Its reorganisation plan was loan. Barclays, BNP Paribas and Natixis were
emerges from bankruptcy. approved on June 18. the other bookrunners in the transaction.
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LOANS
China 48 Hong Kong 48 Japan 49 Taiwan 50 Vietnam 51 Denmark 51 Germany 51 Italy 53 Nigeria 54
Switzerland 54 UK 54 United States 55 Mexico 56 Leveraged Loans 56 Restructuring 58
FRONT STORY US LEVERAGED MARKET
Record yields will test CLOs

Defaults and downgrades expected to rise
Fitch is forecasting a 2023 leveraged loan default rate of 2%–3%
CLO managers will have to contend with an 53û#,/ûISSUANCEûOFû53BNûTHISûYEARû COMPANIESûMAYûHAVEûTROUBLEûMEETINGûTHEIRû
uptick in downgrades and defaults as loan THROUGHûTOû/CTOBERûûISûDOWNûMOREûTHANûû new interest expenses, leading to an
YIELDSûHITûAûRECORDûHIGHûAMIDûRISINGûINmATIONû from the same period in 2021, a record year increase in downgrades and defaults.
and recession concerns, which could FORûVOLUMESûACCORDINGûTOû,0#û#OLLATERALû
imperil returns to the funds’ investors. The potential for lower returns to holders of
Yields for loans extended to companies the riskiest portion of the funds, the equity, “The Fed is hiking a lot more
rated Single B jumped to a record 10.27% in could make it harder to sell new deals. aggressively, and the hope
the third quarter after sitting at 4.51% in of a soft landing has taken a
January, the second-lowest monthly yield NEW WORLD
pretty big hit. We are trying
SINCEû2ElNITIVû,0#ûBEGANûTRACKINGûTHEûDATAû At the start of the year, companies
in 2011. Fitch Ratings is forecasting a 2023 CONTINUEDûTOûADDûONûCHEAPûDEBTûTAKINGû
to price deals today that were
leveraged loan default rate of 2%–3% and a advantage of near-zero interest rates and committed to nine months ago,
ûDEFAULTûRATEûFORûBOTHûLOANSûANDûHIGH DEMANDûFORûmOATING RATEûDEBTûFROMûBOTHû and the world has completely
YIELDûBONDSûOFûn CLOs and retail loan funds as the economy changed”
Borrowing costs for companies that rely recovered from the volatility of Covid-19.
on the US leveraged loan market increased 4HISûHELPEDûBUTTRESSûBANKSûEAGERNESSûTOû
ASûTHEû&EDERALû2ESERVEûHIKEDûRATESûlVEûTIMESû UNDERWRITEûBILLIONSûOFû53ûDOLLARSûOFû
THISûYEARûANDû4HURSDAYSûINmATIONûNUMBERSû lNANCINGûFORûNEWûLEVERAGEDûBUYOUTS
INDICATEûADDITIONALûLARGEûHIKESûMAYûBEûONû But conditions quickly changed after
the horizon. The higher interest expenses 2USSIAûINVADEDû5KRAINEûANDûCONCERNSûABOUTû
may lead to a jump in downgrades and RISINGûINmATIONûINCREASEDûTHEûPROSPECTûOFû 30û'LOBALû2ATINGSûh7EAKESTû,INKSvû
defaults, which could weigh on CLOs, the quick rate hikes causing a chill in the market. those credits rated B– or lower with negative
BIGGESTûBUYERSûOFûTHEûDEBTû4HEûFUNDSûCANû 4HEû,0#ûûAûCOHORTûOFûTHEûLARGESTûMOSTû rating outlooks, increased to 220 in
only hold so many loans with the lowest liquid loans, has fallen more than 6% this 3EPTEMBERûFROMûûINû*ULYû7EAKESTûLINKû
credit ratings and an uptick in defaults year, dropping to a more than two-year low default rates are, on average, eight times
could cut returns to the CLOs’ investors, and OFûûCENTSûONûTHEûDOLLARûONû/CTOBERûû)Tû higher than overall speculative-grade
MAKEûRAISINGûNEWûDEALSûMOREûDIFlCULT REBOUNDEDûSLIGHTLYûBEFOREûSETTLINGûATûû DEFAULTûRATESûACCORDINGûTOûANû/CTOBERûû
cents on Wednesday. REPORTûFROMûTHEûRATINGSûlRM
)Nû3EPTEMBERûDEALSûTHATûHADûBEENû !SûRECESSIONûFEARSûBEGANûTOûMOUNTûINûTHEû
“We expect Triple C rated loan underwritten in early 2022 struggled as SECONDûANDûTHIRDûQUARTERSû#,/SûBROADENEDû
downgrades to reach around BANKSûFACEDûAûDIFFERENTûLENDINGûENVIRONMENT the risk factor language in their deal
"ANKSûWEREûFORCEDûTOûSELLûAû53BNû documents to alert investors that rising
9%–11% in a recessionary
term loan and a US$500m-equivalent euro- interest rates and increased costs may weigh
scenario, which, if realised DENOMINATEDûTERMûLOANû"ûFORûTHEûBUYOUTûOFû ONûTHEûCOMPANIESûTHEYûLENDûTOû)FûBORROWERSû
along with defaults, would CITRIX SYSTEMSûBYû6ISTAû%QUITYû0ARTNERSûANDûANû cannot make interest payments and default,
likely divert equity cashflows AFlLIATEûOFû%LLIOTTû)NVESTMENTû-ANAGEMENTû CLO investors could see their returns
in a number of deals” at the steep discount of 91 cents on the impacted, the funds warned.
DOLLARû,ATEûLASTûMONTHûAû53BNûlNANCINGû “We have a lot of low-rated companies
for BRIGHTSPEED was pulled after lead WITHûAûLOTûOFûLEVERAGEûANDûmOATING RATEûBANKû
ARRANGERSûCOULDNTûlNDûBUYERS DEBTûANDûTHEYûWILLûSTRUGGLEûWITHûINTERESTû
“The Fed is hiking a lot more aggressively, COVERAGEvûSAIDû#HRISû0ADGETTûHEADûOFû
and the hope of a soft landing has taken a LEVERAGEDûlNANCEûRESEARCHûANDûANALYTICSûATû
PRETTYûBIGûHITvûSAIDû-ICHAELû!NDERSONûHEADû -OODYS
of US credit strategy at Citigroup. “We are “A CLO can only own so many Caa [rated
“We expect Triple C rated loan trying to price deals today that were credits] without implications, so they are
downgrades to reach around 9%–11% in a committed to nine months ago, and the VERYûCONSCIOUSûFORûTHATûPOTENTIALûNUMBERûTOû
recessionary scenario, which, if realised WORLDûHASûCOMPLETELYûCHANGEDv INCREASEûESPECIALLYûBECAUSEûTHEREûAREûSOû
along with defaults, would likely divert many B3 rated companies and they are
EQUITYûCASHmOWSûINûAûNUMBERûOFûDEALSvûSAIDû RISING EXPENSES VULNERABLEûTOûAûDOWNGRADEûINûTHISû
Rishad Ahluwalia, head of CLO research at 7ITHûTHEûSIGNIlCANTûCHANGEûINûMARKETû ENVIRONMENTv
*0û-ORGANûINû,ONDON CONDITIONSûANDûHIGHERûBORROWINGûCOSTSû Kristen Haunss

China Citic Bank International and Bank of HSBC, Mizuho and MUFG were
East Asia are the mandated lead arrangers, SUSTAINABILITYûADVISERSûMANDATEDûLEADû
ASIA-PACIFIC BOOKRUNNERSûANDûUNDERWRITERSûOFûTHEû ARRANGERSûANDûBOOKRUNNERSûOFûTHEûUNSECUREDû
transaction, which comprises a term loan COMMITTEDûFACILITYûWHILEû3-"# joined as a
and revolving credit facility. Bank of NON ACTIVEû-,!"ûANDûSUSTAINABILITYûADVISERû
CHINA CommunicationsûJOINEDûASû-,!"ûPRIORûTOûTHEû BEFOREûTHEûLAUNCH
launch into syndication. The deal, which comprises a tranche A term
CIFI MISSES INTEREST PAYMENT 4HEûLOANûWILLûBEûAVAILABLEûINû(ONGû+ONGûORû LOANûOFûUPûTOû(+BNûANDûAû(+BNû
US dollars, offering an interest margin of revolving credit tranche B, offers an interest
Shanghai-headquartered and Hong Kong- BPûOVERû(IBOR3/&2ûANDûCARRYINGûAû RATEûMARGINûOFûBPûOVERû(IBORûANDûHASûAû
listed property developer CIFI HOLDINGS has greenshoe option of up to US$250m. remaining average life of 4.75 years.
missed an interest payment on a US$364m- -,!SûTAKINGû53M EQUIVALENTûORûABOVEû -,!"SûWITHûCOMMITMENTSûOFû(+MûORû
equivalent 3.5-year term loan it raised in 2019. WILLûEARNûTOP LEVELûALL INûPRICINGûOFûBPû MOREûRECEIVEûAûTOP LEVELûALL INûOFûBPûVIAû
The company failed to pay the interest BASEDûONûAûBPûPARTICIPATIONûFEEûANDûAûBPû ANûUPFRONTûFEEûOFûBPûWHILEû-,!SûTAKINGû
DUEûONû/CTOBERûûANDûISûINûDISCUSSIONSûWITHû EARLY BIRDûFEEûWHILEûLEADûARRANGERSûTAKINGû (+MnMûEARNûANûALL INûOFûBPû
BANKSûTOûEXTENDûTHEûPAYMENTûTOûTHEûENDûOFû US$26m–$39m-equivalent will earn an all-in BASEDûONûAûFEEûOFûBPû,EADûARRANGERSûWITHû
this month. OFûBPûBASEDûONûAûBPûPARTICIPATIONûFEEû (+MnMûEARNûANûALL INûOFûBPû
The loan, closed in August 2019, is split ANDûAûBPûEARLY BIRDûFEE BASEDûONûAûFEEûOFûBP
INTOû53MûANDû(+BNû53M û Arrangers coming in for US$15m–$25m- The all-in calculations include an early-
tranches. EQUIVALENTûWILLûEARNûANûALL INûOFûBPûVIAûAû BIRDûFEEûOFûBPûOFFEREDûTOûBANKSû
#HINAû#ONSTRUCTIONû"ANKû!SIA ûWASûTHEû BPûPARTICIPATIONûFEEûANDûAûBPûEARLY BIRDû COMMITTINGûBYû.OVEMBERûû
MANDATEDûLEADûARRANGERûANDûBOOKRUNNERû fee. The SLL has a tiered incentive mechanism
and the facility and security agent of the 4HEûEARLY BIRDûDEADLINEûISû.OVEMBERû UNDERûWHICHû%32ûWILLûBEûENTITLEDûTOûAû
lNANCINGûWHICHûPAIDûTOP LEVELûALL INûPRICINGû 0ROCEEDSûWILLûBEûUSEDûTOûRElNANCEûDEBTû reduction in the interest rate upon
OFûBPûBASEDûONûANûINTERESTûRATEûMARGINûOFû INCLUDINGûAû53MûlVE YEARûLOANûTHEû ACHIEVINGûSUSTAINABILITYûTARGETSû
BPûOVERû,IBORûORû(IBORûANDûANûAVERAGEû WATERûUTILITYûOBTAINEDûFROMûûBANKSûINû 0ROCEEDSûOFûTHEû3,,ûAREûFORûTHEûRElNANCINGû
life of 3.175 years. -ARCHûûANDûAû53MûlVE YEARûLOANû OFûEXISTINGûBORROWINGSûINVESTMENTSûWORKINGû
)NûAûlLINGûTOûTHEû(ONGû+ONGûSTOCKû SIGNEDûWITHûûBANKSûINû*ANUARYûûANDû capital and general corporate purposes.
EXCHANGEûINûLATEû3EPTEMBERû#)&)ûSAIDûTHEREû for general corporate purposes. 4HISûISûTHEûlFTHû3,,ûTHATû%32û'ROUPûHASûCLOSEDû
WEREûDIFlCULTIESûWITHûCASHûDISTRIBUTIONûINû in the past 12 months and follows a S$300m
relation to a trust product used to raise 53M ûlVE YEARû3,,ûTHATûTHEûBORROWERû
funds for a project in Tianjin city, as sales HONG KONG launched into general syndication in June.
were not good. %32ûISûNOWûAûSIGNATORYûTOûTHEû5NITEDû
)TûSAIDû#)&)ûWOULDûhCONTINUEûTOûTAKEûALLû PCGI PREPS REFINANCING .ATIONS SUPPORTEDû0RINCIPLESûFORû
practical steps to enhance its efforts to 2ESPONSIBLEû)NVESTMENTû)TûHASûRETAINEDûITSû
IMPROVEûITSûCASHmOWûPOSITIONvûALTHOUGHûTHEû PCGI HOLDINGS, the parent of Hong Kong -3#)û%3'û!ûRATINGûWHILEû3USTAINALYTICSûHASû
domestic real estate industry is “facing severe INSURERû&7$û'ROUPûISûLIKELYûTOûMANDATEû placed the company in the low risk category
DIFlCULTIESûANDûCHALLENGESûANDûTHEû#OVID û lVEûBANKSûONûAû53BNûTHREE YEARû OFûEXPERIENCINGûAûMATERIALûlNANCIALûIMPACTû
EPIDEMICûSITUATIONûREMAINEDûVOLATILEv BORROWINGûTOûRElNANCEûAûPRE )0/ûLOANûITû FROMû%3'ûFACTORS
raised last year.
CHINA WATER AFFAIRS RETURNS CMB Wing Lung Bank, Mizuho Bank, Nanyang FORTUNE REIT BUILDS CLUB
Commercial Bank, SMBC and United Overseas
Hong Kong-listed CHINA WATER AFFAIRS GROUP BankûHAVEûBEENûSHORTLISTEDûTOûLEADûTHEûLATESTû FORTUNE REAL ESTATE INVESTMENT TRUST is self-
HASûLAUNCHEDûAû53M EQUIVALENTûlVE transaction. ARRANGINGûAû(+BNû53M û
YEARûBORROWINGûRETURNINGûTOûTHEûLOANû ,ASTûYEARû0#')ûOBTAINEDûAûPRE )0/û DUAL TRANCHEûCLUBûLOANûRETURNINGûTOûTHEû
markets after 2-1/2 years. lNANCINGûOFûAPPROXIMATELYû53Mn MARKETûNINEûMONTHSûAFTERûOBTAININGûAû
$800m from a handful of relationship SMALLERûSYNDICATEDûBORROWING
ASIA-PACIFIC LOANS BOOKRUNNERS – FULLY BANKS The latest transaction comprises tranches
SYNDICATED VOLUME (INCLUDING JAPAN) &7$ûRElLEDûITSû(ONGû+ONGû)0/ûINû OFûTHREEûANDûlVEûYEARSû0ROCEEDSûWILLûBEûUSEDû
BOOKRUNNERS: 1/1/2022 TO DATE 3EPTEMBERûTHISûYEARûAFTERûPUTTINGûTHEûDEALû for general corporate purposes.
Managing No of Total Share OFûABOUTû53BNûONûHOLDûAMIDûCHALLENGINGû 4HEûDEALûISûLIKELYûTOûCLOSEûINû/CTOBERûWITHû
bank or group issues US$(m) (%) MARKETûCONDITIONSûINû-AY AûHANDFULûOFûTHEû(ONGû+ONG LISTEDû2%)4Sû
1 Bank of China 297 76,114.54 16.4 )Nû-ARCHû&7$ûOBTAINEDûAû53BNû RELATIONSHIPûBANKS
2 Mizuho 379 64,224.82 13.8 THREE YEARûLOANûFROMûûBANKSû )Nû*ANUARYûTHEûBORROWERûRAISEDûAû
3 MUFG 608 49,327.69 10.6 0ROCEEDSûOFûTHATûLOANûAREûFORûGENERALû (+BNûlVE YEARûSUSTAINABILITY LINKEDû
4 Sumitomo Mitsui 451 39,819.59 8.6 CORPORATEûPURPOSESûANDûRElNANCINGûOFûAû LOANûFROMûFOURûBANKSû
5 Taiwan Finl Hldgs 31 18,171.15 3.9 BORROWINGûTHATûBACKEDûTHEûCOMPANYSû
6 ANZ 52 12,345.22 2.7 acquisition of the life insurance unit of Siam
7 HSBC 66 11,903.61 2.6 Commercial Bank in 2020. INDIA
8 China Construction 46 11,548.31 2.5
9 Standard Chartered 45 9,129.54 2.0 ESR LAUNCHES SLL RELIANCE EYES OFFSHORE BORROWING
10 China Dev Bank 8 8,909.03 1.9
Total 2,290 464,015.37 ESR GROUPûHASûLAUNCHEDûAûlVE YEARû RELIANCE INDUSTRIES and RELIANCE JIO INFOCOMM
Proportional credit SUSTAINABILITY LINKEDûLOANûOFûUPûTOû(+BNû AREûINûTALKSûWITHûRELATIONSHIPûBANKSûFORû

Source: Refinitiv SDC code: S3a 53M ûINTOûGENERALûSYNDICATION offshore loans.

LOANS ASIA-PACIFIC
)Nû-ARCHû2ELIANCEû*IOû)NFOCOMMûOBTAINEDû
Taiwan Inc sweetens Aû53MûlVE YEARûLOANûFORûRUPEEû

expenditure, according to data from the
)NDIANûCENTRALûBANK
loan pricing *IOûHADûBEENûINûTALKSûTOûRAISEûNEWûMONEYû

FROMûAû53MûCLUBûLOANûFORûCAPITALû
expenditure purposes.
ASIA Borrowers pay up to close deals as banks face increased funding costs
TATA CAPITAL RAISES US$120m
Taiwan’s famously wafer-thin corporate loan REAL ESTATE RISK
margins are getting wider as lenders become Rising interest rates have hit the available TATA CAPITAL FINANCIAL SERVICES has signed a
more conservative in the wake of rising interest bank liquidity for real estate borrowings, which US$120m three-year loan, returning to the
rates and recession concerns. generally carry higher risk weightings for lenders. offshore syndicated loan market after an
In recent weeks, several Taiwanese borrowers In February, Taiwan’s Financial Supervisory ABSENCEûOFûOVERûTWOûYEARS
have sweetened their loan pricings in a bid to Commission introduced higher risk weightings on Mizuho Bank was the mandated lead
cross the finish line. QUEEN TAK DEVELOPMENT real estate borrowings, with corporate loans for ARRANGERûANDûBOOKRUNNERûOFûTHEûNEWûMONEYû
increased the after-tax interest rate floors on its land acquisition, development and construction loan, which Export Development Canada joined.
NT$12.7bn (US$399m) seven-year debut loan to purposes going up to 200% from 150%. )Nû*ANUARYûû4ATAû#APITALû&INANCIALû
2.5% and 2.7% from the original 2.1% and 2.2% In addition, Taiwanese banks have caps on 3ERVICESûRAISEDûITSûDEBUTûOFFSHOREû53M
at launch in August. construction loans internally and are subject to a equivalent three-year loan, which drew
Taiwan-listed advanced casting components 30% regulatory limit on total real estate loans versus THREEûBANKSûINûSYNDICATIONû
producer YEONG GUAN ENERGY TECHNOLOGY GROUP the bank’s aggregate deposits and issued bonds. )TûPAIDûTOP LEVELûALL INûPRICINGûOFûBPûORû
raised the interest margins on its NT$4.5bn dual- The financings for Queen Tak and Yeong Guan BPûBASEDûONûINTERESTûMARGINSûOFûBPûOVERû
tranche loan by 60bp, with the two-year tranche fall into the real estate category, and thus lenders YENû,IBORûANDûBPûOVERû,IBORûRESPECTIVELYû
now paying 120bp over Taibor and the five-year are demanding higher pricings. Queen Tak is raising Tata Capital Financial Services is a
tranche offering 110bp. Meanwhile, printed circuit funds to build a residential and office mixed-use SUBSIDIARYûOFû4ATAû#APITALûANDûPROVIDESû
boards manufacturer APEX INTERNATIONAL also project in New Taipei, while Yeong Guan’s loan is for COMMERCIALûANDûINFRASTRUCTUREûlNANCEûASû
upped the margin on a US$100m five-year loan constructing its new plant in Taichung. well as wealth management and consumer
by 7bp to a 60bp–77bp range over TAIFX. “Many banks’ exposures to such borrowings loans to retail, corporate and institutional
“It is clear that lenders are becoming are already high,” said another Taipei-based loan customers.
extremely conservative towards deals in the banker. “Banks are very selective on real estate
market,” said a Taipei-based senior loan banker loans given their limited resources. Deals that do
at a Taiwanese bank. “Funding costs for banks not pay handsomely enough or without proper INDONESIA
have increased significantly along with the rising risk-return calculations will suffer.”
interest rates this year. We see very little US HARUM ENERGY POWERS UP RCF
dollar loans, and for NT dollar loans, the thin WEAKER CAPITAL ADEQUACY
margins do not reflect our costs anymore.” Another factor tying Taiwanese banks’ hands is Thermal coal producer HARUM ENERGY has
Last month, the US Federal Reserve raised their capital adequacy ratios, which at end-June raised a US$390m revolving credit facility,
its key interest rate by 75bp for the third time in fell to the lowest level in seven quarters. returning to the loan markets after two
a row, while Taiwan’s central bank increased its The total capital adequacy ratio for the 39 years.
base rate by 12.5bp to 1.625%. Taiwan’s recent domestic banks averaged 14.22%, down 69bp Bank BTPN, Bank CIMB Niaga, Bank QNB
rate rise follows previous increments of 25bp and from three months earlier, according to data Indonesia, DBS Bank, OCBC Bank and United
12.5bp in March and June, respectively, for a total released this month by the FSC. Overseas Bank are the lenders of the
combined increase of 50bp this year. The ratio measures the proportion of a bank’s syndicated loan, which will mature on
Annual consumer inflation in Taiwan hit a near capital to the risk-weighted assets. Banks must $ECEMBERûû
14-year high of 3.59% in June but has since fallen maintain the ratio above 10.5%, while the domestic 0ROCEEDSûAREûFORûCAPITALûEXPENDITUREû
to 2.75% in September, according to official systemically important banks must retain 14.5%. working capital, general corporate and
figures. Market participants said the drop was due to investment purposes.
Meanwhile, three-month TAIFX – Taiwan’s increasing risk-weighted assets such as real estate (ARUMû%NERGYûISûAIMINGûTOûDIVERSIFYûINTOû
interbank US dollar lending rate – jumped to loans, and the expanded losses from the valuation nickel mining and processing, which would
a record high of 4.38% on October 14 after of bond holdings and stock market investments. REQUIREûSUBSTANTIALûFUNDING
hovering around 3% in July and August. The rate “Banks’ capital adequacy ratios are under )Nû/CTOBERûûTHEûCOMPANYûRAISEDûAû
has increased almost 17-fold from the 0.26% scrutiny at year-end traditionally. We can either 53MûTHREE YEARûREVOLVERûFORûRElNANCINGû
seen at the beginning of the year. boost capital or reduce loans to meet higher ratios,” purposes.
Taiwan’s syndicated loan volume took a hit said a third loan banker. “Boosting capital will take
in the third quarter as a result, plummeting time, especially when the market is volatile. It is
43.1% year-on-year to US$7.09bn with 46 deals, probably easier to be picky on loans going forward.” JAPAN
according to Refinitiv LPC data. Aileen Chuang
JOHNSON CONTROLS REFI ATTRACTS 13
The plans to fundraise follow telecoms Jio is considering a loan of around -ULTINATIONALûBUILDINGûSYSTEMSûGROUPû
PROVIDERû*IOûWINNINGûAIRWAVESûWORTHû53BNû 53BNûWITHûAûTENORûOFûTHREEûTOûSEVENû JOHNSON CONTROLS INTERNATIONAL has signed a
INû)NDIASû'ûSPECTRUMûAUCTIONûINû!UGUSTû4HEû years, according to local media reports, cBNû53M ûlVE YEARû3AMURAIû
company could also tap export credit agencies WHILEû2),ûISûINûDISCUSSIONSûFORûAû53BNû RElNANCINGûATTRACTINGûûLENDERSûINû
TOûlNANCEûITSûSWITCHûTOû'ûNETWORKûEQUIPMENT lVE YEARûBORROWING syndication.

Masan scores largest loan
VIETNAM Corporates garner strong interest on rarity value and strong economic fundamentals
Vietnamese conglomerate MASAN has closed its for a refinancing, with launch slated for “Vietnam is the only country in Asia-Pacific
largest, longest and cheapest syndicated loan year-end. to have ratings upgraded by Moody’s since early
following a stellar response from lenders eyeing “We still have appetite to lend to Military Bank this year,” said a third senior loan banker. “We
high-quality assets. due to its government-related background and are optimistic about the economic growth of
The US$600m five-year transaction attracted supportive economic environment, and we also Vietnam due to its foreign direct investment
37 lenders in general syndication, with Taiwanese welcome new names to expand our investment inflows and the increase in supply chain
lenders accounting for the bulk of the retail pools,” said another senior loan banker. diversification from China.
liquidity. The 20 Taiwanese banks that joined the Military Bank, rated Ba3/B+ (Moody’s/ “Vietnam’s upbeat growth outlook is poised
deal took about 54.7% of the final size. Fitch), counts large state-owned enterprises, to buck the slowing trend elsewhere in Asia, and
Lenders were keen to join Masan’s deal as including Viettel Group, Vietnam’s largest we believe it will continue to place itself firmly on
the borrower is considered a top-tier corporate telecommunications company, among its the radar of foreign investors.”
and provides diversification away from the shareholders.
financial institution sector, which has dominated Also, some Vietnamese borrowers have DEAL DETAILED
Vietnam’s loan activity in recent years. repaid their loans, freeing up Taiwanese lenders’ BNP Paribas, Credit Suisse, HSBC and Standard
“It’s a rare corporate borrowing from Vietnam liquidity. This includes the US$1bn one-year Chartered were the mandated lead arrangers
and the pricing is attractive in terms of Masan’s loan raised last year for Vietnam Joint Stock and bookrunners of Masan’s facility, which has a
strong credit profile,” said a Taiwanese loan Commercial Bank for Industry and Trade base size of US$375m and carries a greenshoe
banker. “In addition, Masan, as a borrower, is not (VietinBank) that was repaid last month. option of up to US$225m.
as frequent as other Vietnamese conglomerates “We faced country limit issues in the first half, Masan is the borrower on a US$250m
such as Vingroup.” but we are not too concerned now as some big- tranche, while its subsidiary The Sherpa is the
Another loan for Vietnamese retailer MOBILE ticket one-year loans raised last year have been borrower on a US$350m portion.
WORLD INVESTMENT met a strong response last repaid,” said the first loan banker. Mandated lead arrangers are Bank of Taiwan,
month. Sixteen banks joined the US$250m three- Rabobank, DBS Bank, Kiatnakin Phatra Bank,
year facility in what is also the borrower’s largest, OPTIMISTIC OUTLOOK Mizuho, MUFG, OCBC, SMBC and Union Bank
longest-tenor and tightest-priced syndicated loan. Lenders are still optimistic about Vietnam’s of Taiwan. Lead arrangers are Bangkok Bank,
Masan’s five-year loan offered top-level all-in economic growth on the back of solid exports BDO Unibank, Cathay United Bank, Chang Hwa
pricing of 305bp based on an interest margin of and consumer spending. The economy is Commercial Bank, Mega International Commercial
290bp over SOFR and an average life of 4.175 expected to grow by 8% this year, beating the Bank, ANZ, Vietnam Joint Stock Commercial
years, while Mobile World’s three-year facility official target of 6%–6.5%. Bank of Industry and Trade, CTBC Bank, First
offered a top-level all-in of 183.3bp based on a Last month, Moody’s upgraded Vietnam’s Commercial Bank, Hua Nan Commercial Bank,
margin of 170bp over compounded SOFR. rating from Ba3 to Ba2 thanks to its growing LBBW, Shinhan Bank, Taichung Commercial
Vietnamese FIs also continue to ramp up exports and manufacturing sector. Bank, Taiwan Business Bank, Taiwan Cooperative
fundraising in the offshore loan market on the back The upgrade reflects Vietnam’s growing Bank, Taiwan Shin Kong Commercial Bank and
of strong lender appetite for the country. MILITARY economic strengths relative to its peers and Woori Bank.
COMMERCIAL JOINT STOCK BANK has launched a greater resilience to external macroeconomic Arrangers are Banque Internationale de
debut three-year borrowing of up to US$460m into shocks that are indicative of improved policy Commerce - BRED, KGI Bank, AfrAsia Bank,
general syndication, while TECHCOM SECURITIES, a effectiveness, said the rating agency. Bank of Kaohsiung, Bank of Panhsin, E. Sun
subsidiary of Vietnam Technological & Commercial Worried about intensifying US-China Commercial Bank, KEB Hana Bank, Taipei Fubon
Joint Stock Bank (Techcombank), has launched a geopolitical rivalry and stung by China’s zero- Commercial Bank, Taishin International Bank,
364-day financing of up to US$150m. Covid lockdowns, tech giants such as Google and Export-Import Bank of the Republic of China and
Meanwhile, car maker VINFAST TRADING AND Apple are shifting some production locations O-Bank.
PRODUCTION is in talks with relationship banks from China to Vietnam to offset business risks. Evelynn Lin
MUFG was the mandated lead arranger MITSUBISHI ESTATE NETS TWO SLLs )Nû-AYûû-ITSUBISHIû%STATEûRAISEDûANû
ANDûBOOKRUNNERûOFûTHEûLOANûWHICHûPAYSûAû cBNû YEARû3,,ûFROMû.ORINCHUKIN
MARGINûOFûBPûOVERû4OKYOûTERMûRISK FREEû Real estate company MITSUBISHI ESTATE has
RATEû4/2& ûUNCHANGEDûFROMûTHEûPREVIOUSû SIGNEDûTWOûSUSTAINABILITY LINKEDûLOANSû
loan. TOTALLINGûcBNû53M TAIWAN
Bank of Iwate, Bank of Kyoto, Chiba Bank, Norinchukin Bank is the sole lender on the
Gunma Bank, Hyakugo Bank, Iyo Bank, Japan Post transaction, which is equally split into a six- APEX INTL LIFTS PRICING
Bank, Joyo Bank, Keiyo Bank, Minato Bank, San-in year piece and an 11-year SLL.
Godo Bank, Shiga Bank and Shinkin Central Bank Funds are for working capital. Taiwan-listed APEX INTERNATIONAL has
joined the transaction. 4HEûBORROWERûTARGETSûTOûREDUCEûCARBONû INCREASEDûTHEûPRICINGûONûITSû53MûlVE
&UNDSûAREûTOûPARTIALLYûRElNANCEûAûcBNû DIOXIDEûEMISSIONSûBYûûBYûûVERSUSû YEARûLOANûLINKEDûTOû%3'ûMETRICS
lVE YEARû3AMURAIûLOANûCOMPLETEDûINû ûANDûTOûINCREASEûITSûRENEWABLEûENERGYû 4HEûINTERESTûRATEûMARGINûHASûBEENû
3EPTEMBERû ratio to 25% over the same period. INCREASEDûBYûBPûTOûAûBPnBPûRANGEûOVERû
4HEûBORROWERûRATEDû"""û30 ûISû JCR provided a third-party opinion for the 4!)&8ûBASEDûONûTHEûBORROWERSûPRE TAXûNETû
HEADQUARTEREDûINû#ORKû)RELAND SLLs. PROlT

LOANS EMEA
Mega International Commercial Bank is the TECHCOM MAKES QUICK RETURN WHICHûWILLûBEûEXTERNALLYûASSESSEDûONûANû
MANDATEDûLEADûARRANGERûANDûBOOKRUNNERûOFû ANNUALûBASISûBYûANûINDEPENDENTûTHIRDûPARTY
THEûlNANCINGûWHICHûCOMPRISESûAû53Mû TECHCOM SECURITIESûAûSUBSIDIARYûOFû +0)SûCOVERûTHEûREDUCTIONûOFûABSOLUTEû3COPEû
term loan tranche A and a US$80m 4ECHCOMBANKûHASûLAUNCHEDûAû DAYû ûANDûûGREENHOUSEûGASûEMISSIONSûTHEû
revolving credit tranche B. The two tranches lNANCINGûOFûUPûTOû53MûRETURNINGûTOû INCREASEûINûTHEûSHAREûOFûRENEWABLEû
CANNOTûEXCEEDû53MûCOMBINED the offshore loan market within six months ELECTRICITYûANDûTHEûINCREASEûINûTHEûNUMBERû
Tranche B is further split into a US$60m OFûRAISINGûAûBIGGERûBORROWING of patients reached with donations in low
tranche B1 and a US$60m tranche B2. CTBC Bank, Maybank, SMBC and Taishin and middle-income countries.
Tranches B1 and B2 cannot exceed US$80m International Bank are the mandated lead BNP ParibasûWASûSOLEûSUSTAINABILITYû
COMBINED ARRANGERSûANDûBOOKRUNNERSûOFûTHEû coordinator on the converted RCF, which is
4HEûMARGINûWILLûDECREASEûBYûBPûIFû!PEXû TRANSACTIONûWHICHûHASûAûBASEûSIZEûOFûUPûTOû aligned with the guidelines set out in the
MEETSûONEûOFûTHEûlVEû%3'ûMETRICSûANDûBYûUPû US$100m and a US$50m greenshoe. ,OANû-ARKETû!SSOCIATIONSû3USTAINABILITYû
TOûBPûFORûMEETINGûTHREEûCRITERIAûORûMORE 4HEûBORROWINGûOFFERSûANûINTERESTûRATEû ,INKEDû,OANû0RINCIPLES
The metrics are related to the company’s MARGINûOFûBPûOVERû3/&2 ,UNDBECKûWILLûEARMARKûANYûINTERESTû
RANKINGûINûTHEû#ORPORATEû'OVERNANCEû -,!SûWITHûCOMMITMENTSûOFû53MûANDû SAVINGSûTOûNEWûSUSTAINABILITY RELATEDû
%VALUATIONûBYûTHEû4AIWANû3TOCKû%XCHANGEû ABOVEûEARNûTOP LEVELûALL INûPRICINGûOFûPû INITIATIVESûFOCUSEDûONûACCESSûTOûBRAINûHEALTHû
water usage or waste-water volume, green VIAûAûBPûPARTICIPATIONûFEEûWHILEûLEADû BETWEENûûANDûû4HESEûINCLUDEû
energy power generation, electricity arrangers participating with US$10m–$14m action to address discriminatory, physical,
consumption and greenhouse gas emissions. WILLûRECEIVEûANûALL INûOFûBPûVIAûAûBPûFEEû ECONOMICûANDûINFORMATIONALûBARRIERSûTOû
-,!SûJOININGûWITHû53MûORûMOREûWILLû Arrangers taking US$5m–$9m are offered a MAKEûSAFEûANDûEFlCACIOUSûBRAINûDISEASEû
EARNûANûUPFRONTûFEEûOFûBPûWHILEûCO BPûALL INûWITHûAûBPûFEE TREATMENTSûMOREûACCESSIBLEûINCLUDINGûINû
ARRANGERSûWITHû53MnMûRECEIVEûBPû &UNDSûAREûTOûRElNANCEûAû53Mû DAYû low and middle-income countries.
0ARTICIPANTSûTAKINGû53MnMûAREû LOANûRAISEDûINû.OVEMBERûLASTûYEARûANDûFORû 4HEû3,,ûWILLûBACKû,UNDBECKSû
OFFEREDûBP general corporate purposes. environmental and social targets as it looks
!PEXSûSUBSIDIARYûAPEX CIRCUIT (THAILAND), is 4HEûBORROWERSûMOSTûRECENTûVISITûTOûTHEû TOûSUPPORTû5.û3USTAINABLEû$EVELOPMENTû
THEûBORROWERûONûTRANCHESû!ûANDû"ûWHILEû loan market was in April for an increased 'OALSûINCLUDINGû3$'ûû'OODû(EALTHûANDû
THEûPARENTûISûTHEûBORROWERûONûTRANCHEû" US$170m 364-day loan. 7ELLBEINGû3$'ûû#LIMATEû!CTIONûANDû3$'û
The parent and its chairman Wang û2EDUCEDû)NEQUALITIES
Shu-mu are the guarantors on tranches A The four-year RCF was originally arranged
and B1, while Wang is the guarantor on INû*UNEûûANDûSUBSEQUENTLYûEXTENDEDûINû
tranche B2. 2020, 2021 and 2022 to mature in 2026.
0ROCEEDSûAREûFORûCAPITALûEXPENDITUREû EUROPE/MIDDLE )TûWASûPARTûOFûAûWIDERûlNANCINGûBACKINGû
RElNANCINGûANDûWORKINGûCAPITALûPURPOSES EAST/AFRICA THEûCOMPANYSûACQUISITIONûOFû53 BASEDû!LDERû
!PEXûMANUFACTURESûDOUBLE SIDEDûANDû "IO0HARMACEUTICALSûWHICHûALSOûINCLUDEDûAû
MULTI LAYERûPRINTEDûCIRCUITûBOARDS $+RBNû53M ûONE YEARûTERMûLOANû
DENMARK THATûWASûREPAIDûINû&EBRUARYûûFROMûTHEû
COMPANYSûCASHmOW
VIETNAM FLSMIDTH SIGNS €150m SLL
MILITARY BANK HITS GENERAL %NGINEERINGûGROUPûFLSMIDTH has signed a GERMANY

õMûSUSTAINABILITY LINKEDûLOANûWITHûTHEû
MILITARY COMMERCIAL JOINT STOCK BANK has .ORDICû)NVESTMENTû"ANKûAIMEDûATûDRIVINGû GOODYEAR EUROPE AMENDS RCF
LAUNCHEDûAûDEBUTûTHREE YEARûBORROWINGûOFû green transition in the mining and cement
up to US$460m into general syndication. industries. GOODYEAR TIRE & RUBBERSû%UROPEANûSUBSIDIARYû
Cathay United Bank, Maybank and Taipei The seven-year loan, which is FLSmidth’s has amended its existing €800m revolving
Fubon Commercial Bank are the mandated lead lRSTû3,,ûISûLINKEDûTOûTHREEûOFûTHEûCOMPANYSû credit facility, extending the maturity out to
ARRANGERSûBOOKRUNNERSûANDûUNDERWRITERSûOFû COREûSUSTAINABILITYûKEYûPERFORMANCEû January 2028 from 2024 and changing the
THEûLOANûWHICHûHASûAûBASEûSIZEûOFû53Mû indicators covering the ratio of suppliers BASEûRATEûFORû53ûDOLLARûLOANSûTOû3/&2ûFROMû
and a greenshoe of US$60m. HAVINGûSCIENCE BASEDûTARGETSû&,3MIDTHSû ,IBOR
4HEûBULLETûFACILITYûPAYSûANûINTERESTûMARGINû own Scope 1 and 2 CO2 emissions, and 4HEûlNANCINGûCOMPRISESûAûõMûTRANCHEû
OFûBPûOVERûTERMû3/&2 Scope 3 emission impact from sold products. ONLYûAVAILABLEûTOû'OODYEARû'ERMANYûANDûAû
Lead arrangers with commitments of FLSmidth provides engineering, õMûALL BORROWERûTRANCHEûAVAILABLEûTOû
US$30m or more will receive a top-level EQUIPMENTûANDûSERVICESûTOûTHEûGLOBALûMININGû 'OODYEARû%UROPEû'OODYEARû'ERMANYûANDû
ALL INûOFûBPûVIAûANûUPFRONTûFEEûOFûBPû ANDûCEMENTûINDUSTRIESû)TûCOMPLETEDûITSû 'OODYEARû/PERATIONS
while arrangers taking US$20m–$29m will acquisition of ThyssenKrupp’s mining Up to €175m of swingline loans and €75m
EARNûANûALL INûOFûBPûBASEDûONûAûFEEûOFû BUSINESSûATûTHEûSTARTûOFû3EPTEMBER INûLETTERSûOFûCREDITûAREûAVAILABLEûFORûISSUANCEû
BPû,EADûMANAGERSûWITHû53MnMû UNDERûTHEûALL BORROWERûFACILITY
WILLûEARNûANûALL INûOFûBPûBASEDûONûAûFEEûOFû LUNDBECK CONVERTS TO SLL 4HEûlNANCINGûPAYSûAûMARGINûOFûBPû
BP OVERû3/&2ûFORû53ûDOLLARûBORROWINGSûBPû
The all-in calculations include an early- 0HARMACEUTICALSûlRMûLUNDBECK has converted OVERû%URIBORûFORûEUROSûANDûBPûOVERû3ONIAû
BIRDûFEEûOFûBPûFORûBANKSûCOMMITTINGûBYû ITSûEXISTINGûõBNûREVOLVINGûCREDITûFACILITYû for sterling.
.OVEMBERû INTOûAûSUSTAINABILITY LINKEDûLOAN 4HEREûISûAûBPûCOMMITMENTûFEEûONû
Funds are for general corporate purposes. )NTERESTûRATESûONûTHEû2#&ûAREûNOWûLINKEDû undrawn funds.
-ILITARYû#OMMERCIALû*OINTû3TOCKû"ANKûISû TOû,UNDBECKSûPERFORMANCEûONûTHREEû 4HEûlNANCINGûALSOûINCLUDESûANûOPTIONûTOû
RATEDû"A"û-OODYS&ITCH SUSTAINABILITYûKEYûPERFORMANCEûINDICATORSû INCREASEûTHEûFACILITYûBYûUPûTOûõM

'OODYEARû%UROPEûANDûITSûSUBSIDIARIESûINû The steel recycling and materials supplier BPûOVERûSIX MONTHû%URIBORûANDûAûõMû
THEû5+û,UXEMBOURGû&RANCEûANDû'ERMANYû also added extension options for a further SEVEN YEARûTRANCHEûPAYINGûAûlXEDûRATEûORû
AREûPROVIDINGûGUARANTEESûFORûTHEûlNANCINGû two years. ûORûAûmOATINGûRATEûOFûBPûOVERûSIX
'OODYEARûANDûITSû53ûANDû#ANADIANû 4HEûAMENDEDûlNANCINGûISûPROVIDEDûBYûANû MONTHû%URIBOR
SUBSIDIARIESûTHATûGUARANTEEûTHEûCOMPANYSû EXPANDEDûGROUPûOFûû'ERMANûANDû 0RICINGûISûLINKEDûTOûANû%3'ûRATINGûFROMû
53ûlRST LIENû2#&ûALSOûPROVIDEûUNSECUREDû INTERNATIONALûBANKSûLEDûBYûCommerzbank, %CO6ADIS
GUARANTEESûONûTHEûAMENDEDû%UROPEANû2#& Deutsche Bank and HSBC. 0ROCEEDSûWHICHûWILLûBEûDISBURSEDûINû
5NDERûTHEûlNANCINGû'OODYEARû%UROPESû 4HEûlNANCINGûWASûORIGINALLYûAGREEDûINû /CTOBERûûWILLûBEûUSEDûFORûTHEûREPAYMENTû
NETûDEBTûTOû%BITDAûISûNOTûPERMITTEDûTOûBEû 2018 totalling €600m-equivalent, including OFûTHREEûõMûBILATERALûLOANSûAGREEDûINû
greater than three times for four Aû53ûDOLLARûFACILITYû4HEûTHREE YEARûlNANCINGû *UNEûûFROMû(ELABAû,""7ûANDû).'
CONSECUTIVEûlSCALûQUARTERS WASûPROVIDEDûBYûAûSYNDICATEûOFûûBANKS 4HEûlNANCINGûORIGINALLYûTARGETEDûõMû
JP Morgan is administrative agent and The loan was extended to August 2023 for BUTûCLOSEDûSUBSTANTIALLYûOVERSUBSCRIBEDûAFTERû
COLLATERALûAGENTûONûTHEûAMENDEDûlNANCING õMûINû*ULYûûWITHûAûGROUPûOFûûBANKS garnering strong interest from investors
&AMILY OWNEDû#RONIMETûISûBASEDûINû despite the volatile market environment.
IDT BIOLOGIKA NETS ESG-READY LOAN Karlsruhe and is a specialist in stainless steel The SSD is the latest transaction in ZF’s
scrap, ferroalloys and primary metals. BROADûAPPROACHûTOûSUSTAINABLEûlNANCE
6IRALûVACCINESûANDûTHERAPEUTICSûCOMPANYûIDT 4HEûCOMPANYûMADEûITSûSUSTAINABLEû
BIOLOGIKA has signed a €140m syndicated MERCEDES SWITCHES TO SUSTAINABILITY lNANCINGûDEBUTûINû-AYûûWITHûTHEû
loan including a rendezvous clause to allow PLACEMENTûOFûAûõMûGREENûBONDûAûlRSTûFORû
THEûADDITIONûOFûAûSUSTAINABILITYûCOMPONENT MERCEDES-BENZ has converted its existing Aû'ERMANûAUTOMOTIVEûSUPPLIERûFOLLOWEDûBYû
4HEûLOANûWILLûBEûUSEDûFORûGENERALû õBNûREVOLVINGûCREDITûFACILITYûINTOûAû AûSECONDûõMûTRANSACTIONûINû.OVEMBERû
corporate purposes. SUSTAINABILITY LINKEDûLOAN 2021.
4HEûlNANCINGûWHICHûCOMPRISESûAûTERMû The undrawn RCF provides liquidity )Nû*ULYûû:&ûFURTHERûEXTENDEDûITSû
LOANûANDûREVOLVINGûCREDITûFACILITYûHASûAûlVE BACKUPûANDûSUPPORTSûTHEûCOMPANYSû SUSTAINABLEûlNANCEûPORTFOLIOûAGREEINGûAû
year maturity with two one-year extension investment-grade ratings. õBNûlVE YEARûREVOLVINGûCREDITûFACILITYû
OPTIONSû4HEû2#&ûMAYûBEûINCREASEDûBYûUPûTOû The conversion future-proofs the RCF and LINKEDûTOûITSûSUSTAINABILITYûGOALûOFûREDUCINGû
€35m through an accordion option. PAVESûTHEûWAYûFORûTHEûPOTENTIALûRElNANCINGû CO2 emissions in all three Scopes of
)TûISûINTENDEDûTHATûAûMARGINûADJUSTMENTû of the facility in 2024–25. greenhouse gas emissions to achieve climate
WILLûBEûADDEDûTOûTHEûlNANCINGûTOûREDUCEûTHEû The company has selected key NEUTRALITYûBYû
APPLICABLEûMARGINûDEPENDINGûONûTHEû performance indicators which focus on
ACHIEVEMENTûOFû%3'ûTARGETSûTHATûHAVEûYETûTOû CLIMATEûPROTECTIONûANDûTHEûCONTRIBUTIONûOFû
BEûAGREED -ERCEDES "ENZûTOûREDUCINGûITSû#/ûFOOTPRINT IRELAND
.OERRûADVISEDû)$4ûONûTHEûlNANCINGûWHILEû !NûEXAMPLEûOFûAû+0)ûISûTHEûWORLDWIDEû
#-3û(ASCHEû3IGLEûADVISEDûTHEûBANKûGROUP share of fully electric vehicles in the EATON RAISES US$3bn REFI
)$4ûPARTûOFûCONTRACTûMANUFACTURINGûANDû -ERCEDES "ENZûmEET
PACKAGINGûGROUPû+LOCKEûISûAûGLOBALûCONTRACTû )Fû-ERCEDES "ENZûACHIEVESûTHEûSELECTEDû $UBLIN HEADQUARTEREDûPOWERûMANAGEMENTû
developer and manufacturer of viral SUSTAINABILITYûGOALSûTHEûCOMMITMENTûFEEûITû company EATONûHASûAGREEDûAû53BNû
vaccines and vectors for gene and PAYSûONûTHEûlNANCINGûWILLûBEûREDUCED RElNANCINGûREPLACINGû53BNûOFûEXISTINGû
immunotherapy drugs. 4HEûlNANCINGûISûINûLINEûWITHûTHEû facilities.
-ERCEDES "ENZû!MBITIONûûSUSTAINABILITYû 4HEûCOMPANYûAGREEDûAû53BNûlVE YEARû
CRONIMET AMENDS AND EXTENDS BUSINESSûSTRATEGYû4HEûCOMPANYûPLANSûTOûGOû REVOLVINGûCREDITûFACILITYûREPLACINGûAû53BNû
ALLûELECTRICûBYûTHEûENDûOFûTHEûSû 2#&ûAGREEDûINû/CTOBERû
CRONIMET has increased its existing depending on market conditions. 4HEûlNANCINGûINCLUDESûANûOPTIONûTOû
SYNDICATEDûLOANûBYûMOREûTHANûõMûTOû $AIMLERûBECAMEû-ERCEDES "ENZû'ROUPûINû INCREASEûBYûUPûTOû53MûANDûAûONE YEARû
AROUNDûõMûEXTENDINGûTHEûlNANCINGûTOû &EBRUARYûAFTERûTHEûSPIN OFFûANDûLISTINGûOFû extension option.
3EPTEMBERû Daimler Truck. The RCF pays a margin over term SOFR
4HEû2#&ûHASûBEENûINûPLACEûSINCEû*ULYûû PLUSûAûBPûADJUSTMENTûBASEDûONûRATINGSû
EMEA LOANS BOOKRUNNERS – FULLY ANDûISûPROVIDEDûBYûAûGROUPûOFûOVERûûBANKSû &ORû!!ûTHEûMARGINûISûBPûANDûTHEûFACILITYû
SYNDICATED VOLUME FROMû%UROPEû!SIAûANDû!MERICA FEEûISûBPûFORû!!ûITûISûBPûANDûBPûFORû
BOOKRUNNERS: 1/1/2022 TO DATE !n!ûITûISûBPûANDûBPûFORû""""AAûITûISû
Managing No of Total Share ZF ADDS ESG-LINKED SSD BPûANDûBPûANDûFORû""""AAûITûISû
bank or group issues US$(m) (%) BPûANDûBP
1 BNP Paribas 146 38,882.35 9.5 Auto parts supplier ZF FRIEDRICHSHAFEN has placed %ATONûISûRATEDû!nûBYû30
2 Credit Agricole 147 35,496.20 8.7 AûõMû%3' LINKEDû3CHULDSCHEINDARLEHENûASû The company also agreed a US$500m 364-
3 UniCredit 112 25,979.30 6.3 ITûCONTINUESûTOûALIGNûITSûlNANCINGûTOûITSû day RCF, replacing an existing US$500m
4 Societe Generale 96 23,220.35 5.7 SUSTAINABILITYûSTRATEGY DAYûFACILITYûALSOûARRANGEDûINû/CTOBERû
5 Sumitomo Mitsui 53 14,743.32 3.6 4HEûMOVEûCOMESûASûSUSTAINABILITYûBECOMESû 2021.
6 Commerzbank 73 13,867.09 3.4 an increasingly decisive factor for investors 4HEûFACILITYûMAYûBEûINCREASEDûBYûUPûTOû
7 Deutsche Bank 66 13,364.04 3.3 when it comes to deciding whether and how 53MûANDûCANûBEûEXTENDEDûBYûONEûYEARû
8 Natixis 68 13,013.38 3.2 much to invest in a company. THROUGHûAûTERMûOUTûOPTIONûFORûAûBPû
9 Santander 69 12,477.62 3.0 The SSD comprises a €346m three-year conversion fee.
10 ING 58 11,892.38 2.9 TRANCHEûPAYINGûAûlXEDûRATEûOFûûORûAû The 364-day facility also pays a margin
Total 539 410,066.43 mOATINGûRATEûOFûBPûOVERûSIX MONTHû OVERûTERMû3/&2ûPLUSûAûBPûADJUSTMENTû
Proportional credit %URIBORûAûõMûlVE YEARûTRANCHEûPAYINGû BASEDûONûRATINGSû&ORû!!ûTHEûMARGINûISû
Source: Refinitiv SDC code: R17 AûlXEDûRATEûOFûûORûAûmOATINGûRATEûOFû BPûANDûTHEûFACILITYûFEEûISûBPûFORû!!ûITûISû

LOANS EMEA
BPûANDûBPûFORû!n!ûITûISûBPûANDûBPû 4HEûlNANCINGûISûBEINGûPROVIDEDûBYûVARIOUSû INTEGRATESûSUSTAINABILITYûINTOûTHEûGROUPSû

FORû""""AAûITûISûBPûANDûBPûANDûFORû !8!ûFUNDSû"ANCOû0ICHINCHAû"ANCOû GLOBALûlNANCINGûPROGRAMME
""""AAûITûISûBPûANDûBP 3ANTANDERû""6!û"ANCOû"0-û"ANKûOFû The framework is in line with the
Citigroup is administrative agent alongside America, Bank of China, Bank of )NTERNATIONALû#APITALû-ARKETû!SSOCIATIONSû
syndication agent JP Morgan and #OMMUNICATIONSû"0%2û"ANCAû#AIXA"ANKû 3USTAINABILITY ,INKEDû"ONDû0RINCIPLESûANDû
documentation agent Bank of America as joint #REDITû!GRICOLEû#)"û'OLDMANû3ACHSû WITHûTHEû,OANû-ARKETû!SSOCIATIONSû
LEADûARRANGERSûANDûJOINTûBOOKRUNNERSûONûTHEû )NFRASTRUCTUREû&INANCEû3#3 3)&û)NTESAû 3USTAINABILITY ,INKEDû,OANû0RINCIPLES
facilities. 3ANPAOLOû*0û-ORGANû-EDIOBANCAû-IZUHOû
Barclays, BNP Paribas, Deutsche Bank, -5&'û.ATIXISû2"#û3-"#û3OCIETEû TERNA TAKES ESG-LINKED LOAN
Goldman Sachs, Morgan Stanley, HSBC, Keybank, 'ENERALEû5NI#REDITûANDû7OORIû"ANK
PNC Bank, TD, Truist Bank, Wells Fargo, Bank of *0û-ORGANûISûFACILITYûAGENT 0OWERûGRIDûOPERATORûTERNA has agreed a
New York Mellon, Bank of China and DBS Bank 4HEûOFFERûISûBEINGûMADEûTHROUGHû õMû%3' LINKEDûCREDITûFACILITYûFROMûSMBC.
also participated. investment vehicle Schemaquarantadue. 4HEûlNANCINGûHASûAûTHREE YEARûMATURITYû
.EWû9ORK LISTEDû%ATONûOPERATESûINûOVERûû The Benettons, which already hold a 33% and an interest rate linked to Terna’s
COUNTRIESûANDûHADû53BNûOFûSALESûINû stake in Atlantia through their holding PERFORMANCEûINûRELATIONûTOûSPECIlCû%3'û
COMPANYû%DIZIONEûWILLûHOLDûûOFû indicators.
Schemaquarantadue with Blackstone 4ERNAûHASûRAISEDûMULTIPLEû%3' LINKEDû
ITALY holding the rest. loans over the past 12 months as it seeks to
REINFORCEûSUSTAINABILITYûINûITSûlNANCING
LOANS BACK ATLANTIA BUY ENEL AGREES EKF SLL The company agreed two €200m three-
YEARû%3' LINKEDûTERMûLOANSûINû3EPTEMBERû
The BENETTON family and BLACKSTONE have Utility ENEL has agreed a US$800m FROMû5NI#REDITûANDû#REDITû!GRICOLEû#)"
ARRANGEDûõBNûOFûLOANSûTOûBACKûTHEIRû SUSTAINABILITY LINKEDûGENERALûPURPOSEûCREDITû Those loans came after a €300m three-
TAKEOVERûOFû)TALIANûAIRPORTûANDûMOTORWAYû facility from Danish export credit agency YEARû%3' LINKEDûCREDITûFACILITYûFROMû".,ûANDû
operator ATLANTIA. %+& CaixaBank in August and a €300m two-year
4HEûMAXIMUMûCONSIDERATIONûPAYABLEû 4HEûFACILITYûISûBASEDûONû%NELSûWORLDWIDEû %3' LINKEDûTERMûLOANûWITHû)NTESAû3ANPAOLOû
under the 23 euros per share offer is BUSINESSûRELATIONSHIPSûWITHû$ANISHû INû&EBRUARY
õBNûWHICHûWILLûALSOûBEûFUNDEDûTHROUGHû suppliers and is aimed at supporting the 4ERNAûISSUEDûAûõBNûGREENûHYBRIDûBONDûATû
UPûTOûõBNûOFûEQUITY development of wind energy as well as THEûBEGINNINGûOFû&EBRUARY
4HEûlNANCINGûINCLUDESûANûõBNû MITIGATINGûTHEûEFFECTSûCAUSEDûBYûCLIMATEû )Nû$ECEMBERûû4ERNAûAMENDEDûITSû
MONTHûCASHûBRIDGEûLOAN CHANGEûASûPARTûOFû%NELSûûNET ZEROû EXISTINGû%3' LINKEDûREVOLVINGûCREDITûFACILITYû
)TûISûBEINGûPROVIDEDûBYûBanco Santander, BBVA, AMBITION INûINCREASINGûTHEûFACILITYûTOûõBNûFROMû
Banco BPM, Bank of America, Bank of China, Bank of 4HEûlNANCINGûWASûARRANGEDûBYû#ITIGROUPû õBNûANDûRENEWINGûTHEûMATURITYûOFûTHEû
Communications, BPER Banca, CaixaBank, Credit as mandated lead arranger, facility agent LOANûFORûlVEûYEARS
Agricole CIB, Goldman Sachs, Intesa Sanpaolo, JP ANDûCOUNTER GUARANTORûTOûLENDERû%+&
Morgan, Mediobanca, Mizuho, MUFG, Natixis, RBC, 4HEûTRANSACTIONûISû%+&SûlRSTû
SMBC, Societe Generale and UniCredit. SUSTAINABILITY LINKEDûLOAN NETHERLANDS
*0û-ORGANûISûFACILITYûAGENT 5NDERûTHEûlNANCINGû%NELû&INANCEû
4HEûBRIDGEûLOANûWHICHûHASûAûSIX MONTHû !MERICAûWILLûBEûABLEûTOûMAKEûAûSIGNIlCANTû FRIESLANDCAMPINA SIGNS SLL
extension option, carries a corporate UPFRONTûDRAWDOWNûWITHûAûlRSTûTRANCHEûINû
guarantee from the HoldCo and the BidCo. /CTOBERûûANDûTHEûREMAINDERûWITHûAû Dairy company FRIESLANDCAMPINA has signed
)TûPAYSûAûMARGINûOVERû%URIBORûWITHûAûû SECONDûTRANCHEûTOûBEûUSEDûEARLYûINû AûõBNûSUSTAINABILITY LINKEDûREVOLVINGû
mOORûBASEDûONûINVESTMENT GRADEûORûNON Both amounts support the development credit facility.
investment grade ratings. OFû%NELSûSTRATEGYûTOûINCREASEûINVESTMENTSûINû 4HEûlNANCINGûREPLACESû
&ORûTHEûlRSTûTHREEûMONTHSûAFTERû wind, helping to lead the energy transition &RIESLAND#AMPINASûEXISTINGûõBNû2#&û
utilisation, the investment-grade margin is TOWARDSûDECARBONISATION WHICHûWASûDUEûTOûMATUREûINû/CTOBERûû
BPûANDûTHEûNON INVESTMENT GRADEûMARGINû 0RICINGûONûTHEûlNANCINGûISûLINKEDûTOû%NELSû The larger facility supports increased
ISûBPûFORûTHREEûTOûSIXûMONTHSûITûISûBPû ABILITYûTOûREACHûITSûTARGETûFORûDIRECTû3COPEûû working capital needs.
ANDûBPûFORûSIXûTOûNINEûMONTHSûITûISûBPû greenhouse gas emissions of equal to or 4HEûFACILITYûHASûAûlVE YEARûMATURITYûWITHû
ANDûBPûFORûNINEûTOûûMONTHSûITûISûBPû BELOWûûGRAMSûOFû#/ûEQUIVALENTûPERû two 364-day extension options.
ANDûBPûFORûnûMONTHSûITûISûBPûANDû K7HûBYû 0RICINGûISûLINKEDûTOûANNUALûPERFORMANCEû
BPûANDûAFTERûûMONTHSûITûISûBPûANDû 4HEûTARGETûCONTRIBUTESûTOûTHEû5NITEDû ONûFOURûSUSTAINABILITYûKEYûPERFORMANCEû
BP .ATIONSû3USTAINABLEû$EVELOPMENTû'OALûû indicators.
4HEREûAREûNOûlNANCIALûCOVENANTS Climate Action. 4HEûlRSTûTWOû+0)SûCOVERûTHEûREDUCTIONûOFû
4HEREûISûALSOûAûõBNûlVE YEARû,UXû The margin steps down or up depending Scope 1, 2 and 3 greenhouse gas emissions
(OLD#OûLOANûCOMPRISINGûAûõBNûTERMûLOANû ONûWHETHERû%NELûACHIEVESûTHEûTARGETûORûNOT ASûVALIDATEDûBYûTHEû3CIENCEû"ASEDû4ARGETSû
and a €50m revolving credit facility. The 4HEûMARGINûDElNITIONûISûLINKEDûTOûTHEû initiative.
TERMûLOANûWILLûBEûUSEDûTOûlNANCEûPARTûOFû VALUEûOFû%NELSûSUSTAINABLEûSTRATEGYûANDûITû 4HEûOTHERûTWOû+0)SûAREûFOCUSEDûONûMAKINGû
"LACKSTONESûõBNûEQUITYûCONTRIBUTION EMBEDSûANûUPFRONTûSUSTAINABILITYûDISCOUNTû PACKAGINGûRECYCLABLEûANDûIMPROVINGûTHEû
4HEûlNANCINGûPAYSûANûINITIALûMARGINûOFû -OREOVERûTHEûLOANûINCLUDESûAûSTEP UPû nutritional value of FrieslandCampina’s
BPûOVERû%URIBORûWITHûAûûmOORû0RICINGû mechanism that will trigger a margin PRODUCTSûINûLINEûWITHûTHEûCOMPANYSû'LOBALû
steps up over time. adjustment in case the target is not achieved. .UTRITIONALû3TANDARDS
The Lux HoldCo loans include a look- 4HEûFACILITYûISûALIGNEDûTOû%NELSû ING and MUFG acted as coordinators on
THROUGHûNETûLEVERAGEûlNANCIALûCOVENANTûANDû 3USTAINABILITY ,INKEDû&INANCINGû&RAMEWORKû THEûlNANCINGûWHILEûHSBC WASûSUSTAINABILITYû
ANûOBLIGORûINTERESTûCOVERûlNANCIALûCOVENANT last updated in January 2022, which coordinator.

ABN AMRO, BNP Paribas, Citibank, Intesa which was due to mature in 2024, cutting
Sanpaolo, JP Morgan, Rabobank, UniCredit, THEûCOMPANYSûGROSSûDEBTûBYû UK
Standard Chartered, Agricultural Bank of China )TûINCLUDESûAûõMûSENIORûSECUREDû
and ICBC ALSOûPARTICIPATEDû2ABOBANKûISû mOATING RATEûBONDûMATURINGûINûûONEûOFû PLAYTECH AGREES REFINANCING
facility agent. the few high-yield deals in the market in the
FrieslandCampina signed a €300m three- second half of 2022. ,ONDON LISTEDûGAMBLINGûSOFTWAREûMAKERû
YEARû3,,ûWITHû).'ûINû-ARCHûû4HEû The repayment was funded through the PLAYTECHûHASûRElNANCEDûITSûEXISTINGûDEBTû
company also agreed a €100m 2.5-year SLL BONDûõMûFROMûCASHûRESERVESûANDûTHEû facilities, agreeing an amended €277m
INû$ECEMBERû term loan. revolving credit facility in place of its
Deutsche Bank, Societe Generale, BNP Paribas, existing €317m RCF, which was due to
Credit Agricole, ICO, CaixaBank, BBVA, Intesa MATUREûINû.OVEMBERû
NIGERIA Sanpaolo and Banco de Sabadell took part in 4HEûAMENDEDûlNANCINGûMATURESûINû
THEûGLOBALûRElNANCINGû /CTOBERûûANDûHASûAûONE YEARûEXTENSIONû
AFC LIFTS NINJA LOAN 4ENDAMûFULLYûREPAIDûAûõMû)#/ option.
BACKEDûLOANûINû&EBRUARYûû4HATûLOANûWASû 0LAYTECHûISûALSOûLOOKINGûTOûRElNANCEûITSû
,AGOS BASEDûINFRASTRUCTUREûlNANCINGû put in place in 2020 to protect the EXISTINGûõMûSENIORûSECUREDûBONDûWHICHû
provider AFRICA FINANCE CORP has increased its company’s liquidity during the Covid-19 ISûDUEûTOûMATUREûINû/CTOBERûû4HEû
THREE YEARûDUAL CURRENCYû.INJAûLOANûTOû crisis. company has served notice that it will
US$389m-equivalent from the original 4ENDAMûISûCONTROLLEDûBYû#6#ûANDû0!)û REDEEMûõMûOFûTHEûBONDûATûPARûONû
US$225m-equivalent target after attracting 0ARTNERS .OVEMBERû
nine lenders in general syndication. 4HEûREPAYMENTûWILLûBEûFUNDEDûTHROUGHû
Mizuho Bank, MUFG and SMBC are the CURRENTûCASHûBALANCESûANDûTHEû2#&ûISû
MANDATEDûLEADûARRANGERSûANDûBOOKRUNNERSû SWITZERLAND EXPECTEDûTOûBEûUNDRAWNûFOLLOWINGûTHEûEARLYû
of the loan, which is split into a US$382m redemption.
TRANCHEû!ûANDûAûcBNû53M ûTRANCHEû" AXPO CLOSES €2.3bn DEAL 0LAYTECHûEXPECTSûINTERESTûSAVINGSûOFû
4RANCHEû!ûPAYSûAûTOP LEVELûALL INûOFûBPû AROUNDûõMûINûû4HEûBALANCEûOFûTHEû
VIAûANûINTERESTûMARGINûOFûBPûOVERû3/&2û 2ENEWABLEûENERGYûPRODUCERûAXPO has closed OUTSTANDINGûBONDûWILLûBEûREPAIDûATûMATURITYû
ANDûUPFRONTûFEESûOFûBPûFORûAûCOMMITMENTû AûõBNûUNSECUREDûCREDITûFACILITYûPROVIDINGû or sooner, taking the total annualised
OFû53MûORûMOREûANDûBPûFORûLESSûTHANû the company with additional liquidity amid savings to €20m.
US$20m. the energy crisis. !FTERûTHEûBONDûREPAYMENTû0LAYTECHûWILLû
4RANCHEû"ûOFFERSûANûALL INûOFûBPûVIAûAû 4HEûFACILITYûBRINGSû!XPOSûTOTALûSYNDICATEDû HAVEûMOREûTHANûõMûOFûAVAILABLEûCASHûONû
MARGINûOFûOVERûBPûANDûANûUPFRONTûFEEûOFû CREDITûFACILITIESûRAISEDûTHISûYEARûTOûõBN ITSûBALANCEûSHEETû4HEûCOMPANYSûONLYûOTHERû
BPûFORûALLûTICKETûLEVELS 4HEûlNANCINGûHASûAûONE YEARûMATURITYû MATERIALûDEBTûOBLIGATIONûISûAûõMûSENIORû
0ARTICIPANTSûAREûBank of Yokohama, WITHûAûONE YEARûEXTENSIONûOPTIONûANDûCANûBEû SECUREDûBONDûMATURINGûINû
Norinchukin Bank, Gunma Bank, Hachijuni Bank, USEDûFORûBOTHûBANKûGUARANTEESûANDûLOANS
Shiga Bank, Shinkin Central Bank, Shizuoka Bank, “The syndicated credit facilities are an ALPHAWAVE TAPS FOR BANIAS BUY
San-in Godo Bank and Fuyo General Lease. IMPORTANTûCOMPONENTûOFûOURûlNANCINGû
.INJAûLOANSûAREûBORROWINGSûDENOMINATEDû portfolio, alongside capital market ,ONDON LISTEDûCONNECTIVITYûTECHNOLOGYûlRMû
in any currency and syndicated in Japan for TRANSACTIONSûINû3WITZERLANDûANDûABROADûANDû ALPHAWAVE IPûISûBACKINGûITSû53MûCASHû
FOREIGNûBORROWERS OURûBILATERALûCREDITûLINESvû*ORISû'ROEmINû ACQUISITIONûOFû)SRAEL BASEDûOPTICALûDIGITALû
!&#ûISûRATEDû!ûBYû-OODYS Axpo’s CFO, said. SIGNALûPROCESSINGûCHIPûDEVELOPERû"ANIASû,ABSû
h7EûWEREûABLEûTOûINCREASEûTHESEûALMOSTû with US$210m of senior secured loans.
TENFOLDûTOûMOREûTHANûõBNûINûTHEûCURRENTû 4HEûACQUISITIONûWILLûBEûFUNDEDûFROMû
SPAIN YEARûANDûADDEDûMOREûTHANûûNEWûBANKSûTOû EXISTINGûCASHûANDûTHEûNEWûlVE YEARû
the portfolio. This allows us to further lNANCINGûWHICHûCOMPRISESûAû53Mû
TENDAM DEBUTS WITH SLLs EXPANDûOURûlNANCINGûCAPACITYûINûANû revolving credit facility and a US$100m term
extremely challenging market loan.
Fashion retailer TENDAM agreed €305.1m of ENVIRONMENTv 4HEûlNANCINGûPAYSûBPûOVERû3/&2
SUSTAINABILITY LINKEDûLOANSûASûPARTûOFûAûWIDERû 4HEûlNANCINGûISûONûTOPûOFûAûõBNûTHREEû !LPHAWAVESûNETûDEBTûAFTERûCLOSINGûISû
RElNANCINGûOFûTHEûCOMPANYSûDEBT ANDûlVE YEARûSUSTAINABILITY LINKEDû EXPECTEDûTOûBEûAROUNDû53M
The loans, which represent Tendam’s syndicated revolving credit facility raised in 4HEûlNANCINGûTOGETHERûWITHûEXPECTEDû
DEBUTûINûSUSTAINABLEûlNANCEûCOMPRISEûAû &EBRUARYûWHICHûHASûSUBSEQUENTLYûBEENû STRONGûCASHmOWûGENERATIONûWILLûSUPPORTûTHEû
€130.9m term loan and a €174.2m revolving INCREASEDûTOûõBN COMPANYSûACCELERATEDûBUSINESSûEXPANSION
credit facility. )Nû3EPTEMBERû!XPOûSECUREDûAû3&RBNû Alongside the acquisition, Alphawave has
0RICINGûISûTIEDûTOûREDUCINGûGREENHOUSEûGASû credit line from the Swiss government as a AGREEDûAûNON BINDINGûMULTI YEARûPURCHASINGû
emissions and increasing the share of LIQUIDITYûBUFFERûTOûCOVERûPOTENTIALûCOLLATERALû FRAMEWORKûWITHûAûLEADINGû.ORTHû!MERICANû
SUSTAINABLEûPRODUCTSûINûTHEûCOMPANYSû requirements of long-term power supply hyperscaler to develop and sell a portfolio of
collections. contracts with its customers. OPTICALûPRODUCTSûANDû$30SûINCLUDINGûFROMû
By the end of 2021, Tendam had already 4HATûlNANCINGûWASûSUBORDINATEDûTOû "ANIASû,ABSûWITHûPOTENTIALûSALESûOFûOVERû
DELIVEREDûûMOREûSUSTAINABLEûGARMENTSû !XPOSûEXISTINGûlNANCINGSûANDûDOESûNOTû US$300m.
BRINGINGûFORWARDûITSûTARGETûOFûAIMINGûFORûû require any security. Alphawave, founded in Toronto, Canada
OFûITSûPRODUCTSûTOûBEûMOREûSUSTAINABLEûBYûTHEû The company also issued a SFr500m in 2017, provides connectivity technology to
end of 2022. SUSTAINABILITY LINKEDûBONDûINû*ANUARYûANDûAû its customers in sectors including data
4HEûWIDERûRElNANCINGûSAWûTHEûEARLYû õMûSUSTAINABILITY LINKEDû CENTRESûCOMPUTINGûNETWORKINGû!)û'û
REPAYMENTûOFûõMûOFûEXISTINGûDEBTû 3CHULDSCHEINDARLEHENûINû-AY autonomous vehicles, and storage.

LOANS NORTH AMERICA
ABRDN INCREASES LOAN and Wells Fargo that will support its ratio to 3 times and its maximum net
APPROXIMATELYû53BNûACQUISITIONûOFû leverage ratio to 3.75 times.
London-listed ABRDN PRIVATE EQUITY OPPORTUNITIES PEERû!LBERTSONS Bank of America is the administrative agent.
TRUSTûPREVIOUSLYû3TANDARDû,IFEû0RIVATEû%QUITYû The two companies together operate Additional lenders are JP Morgan, SMBC,
Trust, has increased its existing syndicated almost 5,000 stores across the US, and in Wells Fargo, MUFG, PNC Bank, TD Bank, Truist
LOANûBYûaMûTOûaM ûACHIEVEDûAûCOMBINEDû53BNûINû Bank, Capital One, US Bank, Citigroup, City
4HEûMULTICURRENCYûlNANCINGûHASûALSOû REVENUEûDURINGûlSCALûYEARûûDELIVERINGû National Bank, Northern Trust and Barclays.
BEENûEXTENDEDûBYûONEûYEARûANDûNOWû ADJUSTEDû%BITDAûOFû53BNûFORûTHEûSAMEû /LINûISûRATEDû"AûBYû-OODYSûANDû""ûBYû
MATURESûINû$ECEMBERû period. 30
2OYALû"ANKûOFû3COTLANDû)NTERNATIONALû The transaction will provide a welcome
JOINEDûTHEûFACILITYûASûLENDERûANDû.AT7ESTû INJECTIONûOFûBRIDGEûLOANûVOLUMEûTOûTHEû FEDERAL REALTY COMPLETES LOANS
-ARKETSûREPLACEDû#ITIGROUPûASûAGENTûINûTHEû investment-grade loan market. At the end of
syndicate, alongside current providers 3EPTEMBERûBRIDGEûLOANûVOLUMEûFORûTHEûYEARû FEDERAL REALTY INVESTMENT TRUST has signed
3OCIETEû'ENERALEûANDû3TATEû3TREETû"ANK STOODûATû53BNûLESSûTHANûHALFûTHEû 53BNûOFûUNSECUREDûLOANSûCOMPRISINGûAû
4HEûLOANûPAYSûAûMARGINûOFûBPûTOû 53BNûRECORDEDûDURINGûTHEûSAMEû 53BNûREVOLVINGûCREDITûFACILITYûANDûAû
BPûOVERû3ONIAûDEPENDINGûONûUTILISATIONû period in 2021. US$600m term loan.
WITHûAûBPûTOûBPûCOMMITMENTûFEEûONû +ROGERûISûOFFERINGû53ûPERû!LBERTSONSû The RCF, which amends and restates the
undrawn funds, reducing depending on share. The transaction includes the COMPANYSû53BNû2#&ûFROMû*ULYûûWILLû
UTILISATIONû4HEREûISûALSOûANûBPû ASSUMPTIONûOFûAPPROXIMATELYû53BNûOFû MATUREûONû!PRILûûû4HEûTERMûLOANûHASûBEENû
arrangement fee. !LBERTSONSûDEBT INCREASEDûFROMû53MûBUTûITSûMATURITYûDATEû
3,0%4ûINCREASEDûTHEûSIZEûOFûTHEûLOANûBYûaMû 4HEûACQUISITIONûWILLûBEûlNANCEDûUSINGû remains unchanged at April 16 2024.
TOûaMûINû3EPTEMBERûûWITHû3TATEû3TREETû CASHûANDûNEWûDEBTûlNANCINGû%XISTINGû The RCF features provisions for the
Bank joining existing lenders Citigroup and !LBERTSONSûBONDSûWILLûBEûROLLEDûINTOûTHEûPROû INCORPORATIONûOFûSUSTAINABILITY LINKEDû
3OCIETEû'ENERALEûONûTHEûlNANCING forma capital structure and rank pari passu PRICINGûADJUSTMENTSûATûAûLATERûDATEû)TSûSIZEû
4HEûLOANûWASûaMûDRAWNûATûTHEûENDûOFû WITHû+ROGERûBONDS MAYûBEûRAISEDûTOûUPûTOû53BNûANDûITSû
3EPTEMBER Kroger intends to maintain its MATURITYûDATEûMAYûBEûEXTENDEDûBYûTWOûSIX
investment-grade status. month periods.
FERGUSON BOOSTS LIQUIDITY !LBERTSONSûMAYûSPINûOFFûAûPORTIONûOFûITSû 4HEûCREDITûSPREADûADJUSTMENTûFORûBOTHû
BUSINESSûINTOûAûSTANDALONEûPUBLICûCOMPANYûINû LOANûAGREEMENTSûISûBPûANDûPRICINGûISûBASEDû
0LUMBINGûANDûHEATINGûPRODUCTSûDISTRIBUTORû conjunction with the regulatory clearance ONûTHEûBORROWERSûDEBTûRATINGû&ORû!!ûTHEû
FERGUSONûHASûAGREEDûAûSERIESûOFûlNANCINGSûTOû process. That divested company, which is 2#&ûPAYSûAûFACILITYûFEEûOFûBPûANDûAûMARGINû
INCREASEûITSûLIQUIDITYûBYû53M INTENDEDûTOûCOMPRISEûnûSTORESûWOULDûBEû OFûBPûWHILEûTHEûTERMûLOANûPAYSûBPûFORû
4HEûlNANCINGSûINCLUDEûAûNEWû53Mû SPUNûOFFûTOû!LBERTSONSûSHAREHOLDERSû !!nûTHEû2#&ûPAYSûBPûANDûBPû
three-year syndicated term loan and a immediately prior to the closing of the merger. WHILEûTHEûTERMûLOANûPAYSûBPûFORû"AA
US$250m increase to the company’s !NûUPûTOû53BNûPAYMENTûWILLû """ûPRICINGûISûBPûANDûBPûANDûBPû
EXISTINGû53BNûSYNDICATEDûREVOLVINGû accompany the spinoff. That payment will FORû"AA"""ûITûISûBPûANDûBPûANDûBPû
CREDITûFACILITYû4HEûAMENDEDû53BNû2#&û dilute the per-share payment stockholders FORû"AA"""nûITûISûBPûANDûBPûANDû
MATURESûINû-ARCHû will receive at the close of the merger. BPûANDûFORûLOWERûTHANû"AA"""nûITûISû
-EANWHILEûANûEXISTINGû53Mû DAYû The transaction is expected to close in BPûANDûBPûANDûBP
BILATERALû2#&ûHASûBEENûREDUCEDûBYû53Mû early 2024. #OVENANTSûAPPLICABLEûTOûBOTHûCREDITû
)TûMATURESûINû-ARCHû /Nû&RIDAYû-OODYSûLOWEREDûITSûOUTLOOKûFORû AGREEMENTSûRESTRICTûTHEûBORROWERSû
The company has also increased its +ROGERûTOûNEGATIVEûFROMûSTABLEûDUEûTOûTHEû maximum leverage ratio to 0.6 times, its
EXISTINGûRECEIVABLESûSECURITISATIONûFACILITYûBYû INCREASEDûDEBTûTOûBEûTAKENûON MINIMUMûlXEDûCHARGEûCOVERAGEûRATIOûTOûû
53MûTOû53BNûEXTENDINGûITûOUTûTOû +ROGERûISûRATEDû"AAûBYû-OODYSûANDû"""û TIMESûITSûMAXIMUMûSECUREDûDEBTûRATIOûTOû
/CTOBERû BYû30û!LBERTSONSûISûRATEDû"A"" 0.35 times, and its maximum
Although Ferguson is headquartered in UNENCUMBEREDûLEVERAGEûRATIOûTOûûTIMES
the UK, its operations are solely focused on OLIN RAISES US$1.55bn
.ORTHû!MERICAûANDûMANAGEDûFROMû.EWPORTû AMERICAS LOANS BOOKRUNNERS – FULLY
.EWSû6IRGINIAû4HEûCOMPANYSûSHARESûHAVEû Chemicals company OLIN has agreed SYNDICATED VOLUME
AûPRIMARYûLISTINGûINû.EWû9ORKûANDûAûSTANDARDû 53BNûOFûLOANSûSPLITûINTOûAû53BNû BOOKRUNNERS: 1/1/2022 TO DATE
listing in London. revolving credit facility and a US$350m Managing No of Total Share
TERMûLOANû"OTHûHAVEûAûlVE YEARûTENOR bank or group issues US$(m) (%)
The deal replaces the company’s credit 1 Bank of America 1070 316,985.98 13.3
agreement from July 2019. The term loan 2 JP Morgan 888 249,452.16 10.5
was fully drawn at close. 3 Wells Fargo 861 217,124.38 9.1
NORTH AMERICA The senior unsecured credit agreement’s 4 Citigroup 434 158,455.68 6.6
SIZEûMAYûBEûINCREASEDûBYûUPûTOû53MûORû 5 RBC 367 77,462.42 3.2
an amount equivalent to 15% of 6 Scotiabank 299 75,387.90 3.2
UNITED STATES CONSOLIDATEDû%BITDAûWHICHEVERûISûSMALLER 7 PNC Finl Services 396 74,324.42 3.1
4HEûCREDITûSPREADûADJUSTMENTûISûBPûANDû 8 BMO 447 74,037.03 3.1
KROGER NETS US$17.4bn M&A BRIDGE PRICINGûISûBASEDûONûTHEûBORROWERSûLEVERAGEû 9 TD Securities 301 67,616.90 2.8
RATIOûRANGINGûFROMûBPûTOûBPû4HEû 10 US Bancorp 380 67,520.30 2.8
Supermarket chain KROGER has received a 2#&ûHASûAûBPnBPûCOMMITMENTûFEE Total 3,759 2,386,118.33
COMMITMENTûLETTERûFORûAû53BNû DAYû #OVENANTSûRESTRICTûTHEûBORROWERSû Proportional credit
SENIORûUNSECUREDûBRIDGEûLOANûFROMûCitigroup minimum consolidated interest coverage Source: Refinitiv SDC code: R7

Wells Fargo is the administrative agent of #EMEXSû/CTOBERûûlVE YEARûLOANû ,!4!-û!IRLINESûCORPORATEûRATINGSûAREû
the RCF and PNC Bank holds that position for COMPRISEDûAû53BNûAMORTISINGûTERMûLOANû ""nûANDûTHEûTRANCHEûRATINGSûAREû""
the term loan. ANDûAû53BNûREVOLVINGûCREDITûFACILITY 4HEûAIRLINEûCOMPANYûlLEDûFORû#HAPTERûû
Additional lenders to the RCF are PNC Bank, 4HEûMARGINûFORûBOTHûFACILITIESûBASEDûONû BANKRUPTCYûINûûAMIDû#OVID û
JP Morgan, Regions Bank, Truist, US Bank, TD, Cemex’s consolidated leverage ratio, ranges shutdowns. On June 18, the US Bankruptcy
Bank of America, Citi, Deutsche Bank, Bank of Nova BETWEENûBPûANDûBPûOVERûTHEûSELECTEDû #OURTûFORûTHEû3OUTHERNû$ISTRICTûOFû.EWû9ORKû
Scotia, BNP Paribas, SMBC and Associated Bank. BENCHMARKûINTERESTûRATEû)TûMAYûBEûINCREASEDûORû CONlRMEDû,!4!-SûPLANûOFûREORGANISATIONû
Additional consenting lenders to the term REDUCEDûBYûUPûTOûBPûDEPENDINGûONûTHEû ANDûlNANCINGûTOûEXITû#HAPTERû
loan amendment are JP Morgan, TD, Regions ACHIEVEMENTûOFûTHREEûSUSTAINABILITY LINKEDû
Bank, Truist, US Bank, Bank of Nova Scotia, BNP targets covering Scope 1 CO2 emissions, the use CITCO SEEKS REFINANCING
Paribas, Bank of America and Wells Fargo. SMBC of clean energy and the use of alternative fuels.
and Associated Bank have also joined that Financial covenants restrict the Financial services provider CITCO is raising
facility as new lenders. company’s maximum leverage ratio to 3.75 53MûOFûLOANSûTHATûWILLûRElNANCEûITSû
"ORROWERû&EDERALû2EALTYû/0ûISûRATEDû"AAû times and its minimum interest coverage existing TLB.
BYû-OODYSûANDû"""ûBYû30û&EDERALû2EALTYû ratio to 2.75 times. 4HEûLOANSûCOMPRISEûAû53MûlVE YEARû
)NVESTMENTû4RUSTûISûRATEDû"AA""" 4HEûFACILITYûWASûGUARANTEEDûBYû#EMEXû term loan A and a US$520m 5.5-year term loan
Corp, Cemex Concretos, Cemex Operaciones "û&UNDSûWILLûRElNANCEûTHEûOUTSTANDINGû
-EXICOûANDû#EMEXû)NNOVATIONû(OLDING US$748.78m remaining on Citco’s existing TLB.
6OLATILITYûINûTHEûLEVERAGEDûlNANCEûMARKETû
which has prompted pricing increases and
LATIN AMERICA demand decreases, encouraged Citco to
SELECTûAû4,!ûASûPARTûOFûITSûlNANCINGûSTRUCTURE
LEVERAGED LOANS 4HEû4,!ûISûOFFEREDûATûBPûOVERû3/&2û
MEXICO WITHûAûû/)$ûANDûTHEû4,"ûISûOFFEREDûATû
BPûOVERû3/&2ûWITHûAûû/)$
CEMEX RAISES €500m SLL UNITED STATES "OTHûLOANSûFEATUREûAûû3/&2ûmOORûANDûTHEû
TLB has 101 soft call protection for 12 months.
Cement company CEMEX has closed a €500m LATAM UPS PRICING ON TLB UBS is administrative agent. Stone Point
THREE YEARûUNSECUREDûSUSTAINABILITY LINKEDû Capital, UBS, JP Morgan, Citizens Bank, US Bank
TERMûLOANûTHATûWILLûBEûUSEDûTOûREPAYûEXISTINGû LATAM AIRLINES increased the interest rate and and Truist AREûJOINTûBOOKRUNNERS
DEBT WIDENEDûTHEûDISCOUNTûONûlNANCINGûTHATûWILLû
Terms, including guarantor structure, REPAYûEXISTINGûDEBTOR IN POSSESSIONûFACILITIESû VERICAST SEEKS US$842m LOAN
lNANCIALûCOVENANTSûANDûINTERESTûRATEûGRIDû ASûITûEMERGESûFROMûBANKRUPTCY
are nearly identical with Cemex’s 4HEû53BNûlVE YEARûTERMûLOANû"ûPRICEDû -ARKETINGûCOMPANYûVERICAST, formerly know
53BNû3,,ûFROMû/CTOBERû ATûBPûOVERû3/&2ûPLUSûAûCREDITûSPREADû as Harland Clarke, is in the market with a
The loan, which was issued under ADJUSTMENTû4HEûNEWû#3!ûISûBPûFORûONE 53MûTERMûLOANûTHATûWILLûRElNANCEûDEBT
#EMEXSû3USTAINABILITY ,INKEDû&INANCINGû MONTHû3/&2ûBPûFORûTHREE MONTHû3/&2û 0ROCEEDSûWILLûBEûUSEDûTOûAMENDûITSû
Framework, increases the amount of ANDûBPûFORûSIX MONTHû3/&2 EXISTINGûDEBTûAGREEMENTûANDûPARTIALLYû
#EMEXSûDEBTûTHATûISûLINKEDûTOûITSû&UTUREûINû The loan launched at US$750m with RElNANCEûTHEûCOMPANYSûCAPITALûSTRUCTUREûTOû
Action strategy. PRICINGûGUIDEDûATûBPûOVERû3/&2ûWITHûAû IMPROVEûITSûlRST LIENûLEVERAGEûANDûNEAR TERMû
All SLLs issued under the framework have mATûBPû#3! CASHmOWûPROlLE
the same metrics and adjustments to the 4HEû/)$ûONûTHEûUPSIZEDûLOANûWASûWIDENEDû The maturity on the loan is June 2026.
interest rate margin. to 91.5 from previous guidance of 92–93. The company is also seeking US$274m in
BBVA, BNP Paribas, Citigroup and Mizuho are The loan now must stay in place for two second-lien secured notes. The notes are due
JOINTûBOOKRUNNERSûANDûJOINTûLEADûARRANGERSû YEARSûBEFOREûITûCANûBEûCALLEDûATûPARûAFTERû INû$ECEMBERû
ONûTHEûlNANCINGû""6!ûALSOûACTEDûASû launching with one year of non-call #ORPORATEûRATINGSûAREû#AA###
SUSTAINABILITYûSTRUCTURINGûAGENT protection and then 101 and then par. -OODYSûDOWNGRADEDû6ERICASTûRATINGSûTOû
!ûBPûmOORûANDûAMORTISATIONûOFûûPERû #AAûFROMû#AAûONû/CTOBERûûANDûCHANGEDû
US LEVERAGED LOANS annum remain unchanged. THEûOUTLOOKûTOûNEGATIVEûFROMûSTABLEû
BOOKRUNNERS: 1/1/2022 TO DATE Lenders will provide unfunded According to the ratings agency, the
Managing No of Total Share commitments to the term loan, with the DOWNGRADESûREmECTûhDETERIORATIONûINû
bank or group issues US$(m) (%) FUNDINGûCONDITIONEDûUPONû,!4!-Sû 6ERICASTSûOPERATINGûPERFORMANCEv
1 Bank of America 557 125,056.95 13.7 emergence from Chapter 11 occurring on or Jefferies ISûTHEûBOOKRUNNER
2 Wells Fargo 465 95,250.73 10.5 BEFOREû&EBRUARYûû,ENDERSûWILLûNOWû
3 JP Morgan 433 80,982.97 8.9 receive ticking fees starting 46 days after
4 Citigroup 172 38,270.19 4.2 pricing of 50% of the margin that increases EUROPE/MIDDLE EAST/
5 Goldman Sachs 162 30,681.41 3.4 to 100% of the margin on day 91. AFRICA
6 Barclays 175 29,956.27 3.3 0REVIOUSLYûLENDERSûWEREûASKEDûTOûFUNDû
7 Truist Financial 208 29,483.85 3.2 their term loan commitments at closing and HOLLAND & BARRETT GETS STRONG
8 PNC Finl Services 190 29,407.56 3.2 they were not conditioned upon the RECEPTION
9 MUFG 140 27,307.30 3.0 emergence from Chapter 11. There were
10 Citizens Finl Group 220 25,060.14 2.8 also no ticking fees. UK health food chain HOLLAND & BARRETT has
Total 1,732 910,713.76 Goldman Sachs was lead-left on the loan. received a strong response from creditors to
Excluding Project Finance. Other arrangers include JP Morgan, Barclays, ITSûALMOSTûBILLIONûDOLLARûDEBTûBUYBACKûPLANû
Source: Refinitiv SDC code: P2 BNP Paribas and Natixis. paving the way for its private equity owner

LOANS LEVERAGED LOANS
,ETTER/NEûTOûRESTOREûTHEûlNANCIALûSTABILITYûOFû TERMûLOANûANDûAûõMûDELAYEDûDRAWNûlRST CONGLOMERATEû(INDUJAû'ROUPSûBUSINESSû

THEûSTRUGGLINGûBUSINESS LIENûTERMûLOANûATûTHEûENDûOFû3EPTEMBERûBUTû process outsourcing unit for an enterprise
LetterOne said it had already got a two- ABANDONEDûPLANSûINû/CTOBERûTOûSELLûAûõMû VALUEûOFû53BN
third participation threshold to proceed HIGH YIELDûBONDûFURTHERûHIGHLIGHTINGûTHEû
WITHûTHEûPLANûTOûBUYûBACKûANûOUTSTANDINGû CHALLENGESûFACEDûBYûJUNKûBORROWERSûLOOKINGû COFORGE LBO RECAP WRAPPED
õMûTERMûLOANûANDûAûaMûTERMûLOANû"û to raise funding.
BOTHûATûnûOFûFACEûVALUE 4HEûlRST LIENûTERMûLOANSûPRICEDûATûBPû BARING PRIVATE EQUITY ASIA has completed a
h4HEREûHASûBEENûAûSTRONGûPOSITIVEû OVERû%URIBORûANDûûmOORûUNCHANGEDûFROMû 53MûLOANûFORûAûRElNANCINGûANDû
response to our offer. We are pleased to have GUIDANCEû4HEû/)$ûWASûSETûATûûVERSUSûûATû DIVIDENDûRECAPITALISATIONûOFû)NDIANû)4û
HADûVERYûSIGNIlCANTûPARTICIPATIONûTHATû launch. SERVICESûlRMû#OFORGE
exceeds the minimum acceptance amount, Bank SinoPac, Credit Agricole, Deutsche Bank,
ALLûATûTHEûMINIMUMûPURCHASEûRATEvûAû E. Sun Commercial Bank, ING, Nomura, Siemens
spokesperson for LetterOne said. ASIA-PACIFIC Financial Services, Standard Chartered and SMBC
,ENDERSûWHOûPARTICIPATEDûBEFOREû/CTOBERû were the mandated lead arrangers and
ûWILLûGETûANûEARLY BIRDûFEEûOFûûFORûTHEû LBO RECAP FOR HGS HEALTHCARE BOOKRUNNERSûOFûTHEûTRANSACTIONûCTBC Bank,
TENDERûOFFERû)NûADDITIONûTHEREûISûAûCONSENTû DBS, Far Eastern International Bank, NEC Capital
fee of 0.25%. BARING PRIVATE EQUITY ASIA has mandated 11 Solutions and Taishin International Bank joined
4HEûlNALûDEADLINEûFORûTHEûREMAININGû BANKSûONûAû53MûLOANûFORûAûRElNANCINGû in general syndication.
lenders who have not yet participated will and dividend recapitalisation of HGS The deal offers an interest margin of
BEû/CTOBERûû!FTERûTHATû,ETTER/NEûWILLû HEALTHCARE, which it acquired through a BPûOVERû3/&2
BEGINûTHEûSETTLEMENTûPROCESS LEVERAGEDûBUYOUTûLESSûTHANûAûYEARûAGO 4HEûBORROWINGûREPRESENTSûAûLEVERAGEû
“This outcome is extremely positive for Bank Sinopac, Cathay United Bank, CTBC multiple of around four times and will
("ûAûBUSINESSûWITHûHUGEûPOTENTIALvûSAIDû Bank, DBS Bank, Deutsche Bank, E.Sun RElNANCEûAû53MûlVE YEARûLOANûOFûTHEû
the LetterOne spokesperson. Commercial Bank, HSBC, Korea Development same maturity completed in July last year.
Creditors that choose not to participate Bank, MUFG, Standard Chartered and SMBC are %ARLIERûTHISûYEARû"0%!ûSOLDûNEARLYûûINû
AFTERûTHEûDEADLINEûWILLûGETûBACKûTHEIRû THEûMANDATEDûLEADûARRANGERSûBOOKRUNNERSû #OFORGEûWHICHûWASûFORMERLYûKNOWNûASû.))4û
INVESTMENTûUPONûTHEûDEBTûMATURITYûOFû and underwriters. 4ECHNOLOGIESûFORûAROUNDû2SBNû
August 2024. 4HEûlVE YEARûBORROWINGûREPRESENTSûAû 53M
4HEûBUYBACKûISûGIVINGûINVESTORSûANûEXITû leverage multiple of around 5.5 times and 4HEû0%ûlRMûlRSTûACQUIREDûAûCONTROLLINGû
FROMûTHEûCREDITûWHICHûHASûBEENûUNDERû WILLûRElNANCEûAû53MûLOANûOFûTHEûSAMEû stake in Coforge in mid-2019 through a
PRESSUREûONûTHEûBACKûOFûRISINGûINTERESTûRATESû MATURITYûCOMPLETEDûINû.OVEMBERûLASTûYEARû LEVERAGEDûBUYOUTûANDûLIFTEDûITûTOûOVERûû
HIGHERûINmATIONûANDûINPUTûCOSTSû 4HATûBORROWINGûREPRESENTEDûAûLEVERAGEû later that year.
“That was a very severely struggling multiple of 5.5–6 times. )TûHASûSINCEûSOLDûSTAKESûINû#OFORGEûINûû
BUSINESSû4HEûBUYBACKûISûAûBLESSINGvûSAIDûAû DBS Bank, Deutsche Bank Singapore and 2021.
CLO fund manager. BRANCHû(3"#û3TANDARDû#HARTEREDû"ANKû )Nû*ULYûLASTûYEARû"0%!ûCOMPLETEDûTHEû
3INO0ACû%3UNû#OMMERCIALû"ANKû+OREAû US$327m loan with 16 lenders, including
HOUSE OF HR PRICES SECOND LIEN $EVELOPMENTû"ANKûANDû-5&'ûWEREûTHEû -,!5"Sû#REDITû!GRICOLEû$EUTSCHEû).'û
original mandated lead arrangers, .OMURAû3IEMENSû&INANCIALû3ERVICESû
"ELGIANûSTAFlNGûlRMûHOUSE OF HR has UNDERWRITERSûANDûBOOKRUNNERSûOFûTHATû 3TANDARDû#HARTEREDûANDû3UMITOMOû-ITSUIû
allocated a €310m second-lien term loan, senior secured term loan. Banking Corp.
THATûFORMSûPARTûOFûAûWIDERûlNANCINGûTHATû The loan offered a top-level all-in pricing 4HATûBORROWINGûPAYSûANûINTERESTûMARGINû
BACKSûITSûACQUISITIONûBYûPRIVATEûEQUITYûlRMû OFûBPûBASEDûONûANûOPENINGûINTERESTû OFûBPûOVERû,IBORûANDûREPRESENTEDûAû
Bain Capital. MARGINûOFûBPûOVERû,IBORûANDûANûAVERAGEû leverage multiple of around 4.3 times.
4HEûEIGHT YEARûTERMûLOANûlNALISEDûATû life of 4.77 years. 0ROCEEDSûRElNANCEDûAû53MûlVE YEARû
BPûOVERû%URIBORûWITHûAûûmOORû )Nû*ANUARYû"0%!ûCOMPLETEDûTHEû amortising loan from 2019 that funded the
UNCHANGEDûFROMûGUIDANCEû4HEû/)$ûISûSETûATû ACQUISITIONûOFûûOFûTHEûTARGETûFROMû)NDIANû LBO.
ûVERSUSûûATûLAUNCHû)TûCARRIESûAûCALLû
protection of non call 1, 102, 101 and par EUROPEAN LEVERAGED LOANS EMEA SPONSORED LOAN BOOKRUNNERS
thereafter. BOOKRUNNERS: 1/1/2022 TO DATE BY VOLUME: 1/1/2022 TO DATE
The loan package also includes a seven- Managing No of Total Share Europe, Middle East, Africa
YEARûLOANûSPLITûBETWEENûAûõBNûlRST LIENû bank or group issues US$(m) (%) Managing No of Total Share
TERMûLOANûANDûAûõMûDELAYEDûDRAWNûlRST 1 BNP Paribas 40 5,320.81 9.3 bank or group issues US$(m) (%)
LIENûTERMûLOANûTHATûlNALISEDûATûBPûOVERû 2 Credit Agricole 32 3,816.16 6.7 1 Credit Agricole 22 2,337.06 7.6
%URIBORûANDûûmOORûUNCHANGEDûFROMû 3 Natixis 15 3,156.27 5.5 2 Natixis 9 2,178.96 7.1
LAUNCHû4HEû/)$ûISûSETûATûûVERSUSûûATû 4 Societe Generale 22 2,746.93 4.8 3 BNP Paribas 23 2,006.27 6.5
launch. They carry 101 soft call protection 5 UniCredit 18 2,297.36 4.0 4 Societe Generale 15 1,856.71 6.0
for six months. 6 Deutsche Bank 18 2,253.59 4.0 5 Deutsche Bank 11 1,410.53 4.6
Barclays, JP Morgan and Societe Generale are 7 Commerzbank 11 2,171.13 3.8 6 JP Morgan 9 1,339.07 4.4
THEûJOINTûPHYSICALûBOOKRUNNERSû"ELlUSûand 8 JP Morgan 16 2,150.77 3.8 7 Bank of America 11 1,299.36 4.2
Rabobank AREûMANDATEDûLEADûARRANGERSû',!3û 9 Santander 17 2,068.57 3.6 8 UniCredit 9 1,209.48 3.9
is admin agent. 10 Bank of America 16 1,981.60 3.5 9 Credit Suisse 11 1,174.67 3.8
Corporate ratings are B2/B, while facility Total 110 56,989.46 10 Morgan Stanley 9 1,077.72 3.5
ratings are Caa1. Excluding project finance. Western Europe only included. Total 75 30,748.51
House of HR had already priced a seven- Excluding project finance.
YEARûLOANûSPLITûBETWEENûAûõBNûlRST LIENû Source: Refinitiv SDC code: P10 Source: Refinitiv SDC code: P13

4HEû53MûINûSENIORûDEBTûREPRESENTSûAû
Private equity firms to target LEVERAGEûMULTIPLEûOFûABOUTûXûACCORDINGû

to people familiar with the proposed
BORROWING
out of court restructurings 0ROCEEDSûWILLûRElNANCEûAû53Mû4,"û

completed in June 2018.
4HATûlNANCINGûCOMPRISESûAû53MûlVE
EUROPE/US Moody’s report says process could hurt first-lien lenders YEARûlRST LIENûPORTIONûANDûAû53Mû
six-year second-lien piece.
Private equity-owned companies facing tougher Sponsors inject equity contributions to keep )TûRElNANCEDûAû53MûlRST LIENûFACILITYû
economic and market conditions are expected to the company afloat and regain ownership of and a US$170m second-lien portion that
execute more out-of-court debt restructurings the restructuring process, as an alternative to BACKEDû++2SûLEVERAGEDûBUYOUTûOFû'OODPACKû
that could negatively impact secured first-lien expensive high interest laden debt to finance in August 2014.
lenders, Moody’s said in a report. company leveraged buyouts. )Nûû++2ûSHELVEDûAûPLANûTOûSELLû
The US and Europe have seen a leveraged 3INGAPORE BASEDû'OODPACKûAFTERûTHEû
buyout boom over the past decade, spurred by SIGNIFICANT PRESENCE CORONAVIRUSûOUTBREAKûHITûVALUATIONS
a long period of low interest rates and leading Private equity sponsors have a significant 4HEû0%ûlRMûHADûRECEIVEDûBIDSûFROMûAûFEWû
to a large number of highly-leveraged, sponsor- presence in speculative-grade companies in consortia after tapping more than a dozen
held companies. However, market players are the US and Europe, according to the Moody’s POTENTIALûBUYERSûINûLATEû
now worried that higher interest rates and a report. About 79% of B3 rated companies in !ûDEALûCOULDûHAVEûVALUEDû'OODPACKûATû
deteriorating credit environment will prompt a North America are owned by private equity firms, ABOUTû53BNû2EUTERSûREPORTEDûATûTHEûTIME
wave of distressed exchanges – when a company compared with 50% ownership in Europe.
suggests existing debt-holders take a haircut on Market players are now expecting to see more
the principal amount of their debt to stave off distressed debt situations and sponsor-driven
bankruptcy and in most cases preserve sponsor liability management transactions against the
ownership – in out-of-court restructuring backdrop of a high interest rate environment. RESTRUCTURING
procedures. “PE-backed companies tend to be funded
If that happens, first-lien secured holders, the mostly with floating-rate debt, making them
debt owners at the top of the priority line for their more vulnerable to base rate increases and EUROPE/MIDDLE EAST/
payments, face their loans being restructured adverse macro-economic changes,” said Padgett. AFRICA
– leading them to incur potential losses. B3 rated companies backed by PE companies
Historically, these secured debt holders have will find it especially challenging to cover their CREDIT MANAGERS EXPECT MORE
been spared, with junior holders towards the interest rate costs as they face supply chain DEFAULTS
bottom of the capital structure facing the brunt constraints, softening demand, and potentially
in court proceedings. higher default rates. Many businesses were able Credit managers are expecting defaults to
“Historically, distressed exchanges affected to access central bank-supported, low interest increase and spreads to widen as credit
mostly junior debt, while senior secured loans easy money during the pandemic and did not conditions come under pressure, according
were spared. However, this dynamic is changing, foresee the extent of the downturn post-Covid. TOûAûQUARTERLYûSURVEYûBYûTHEû)NTERNATIONALû
with even first-lien loans being restructured out “There isn’t really a stop-gap solution, as lots !SSOCIATIONûOFû#REDITû0ORTFOLIOû-ANAGERS
of court, and contributing to poor overall recovery of low-rated businesses are hit with rising costs,” %IGHTY TWOûPERCENTûOFûRESPONDENTSûTHINKû
averages for this debt class,” the report said. said a restructuring partner at a UK-based law CORPORATEûDEFAULTSûWILLûINCREASEûINû.ORTHû
Less rigorous documentation and weak firm. “During Covid there was a lot of optimism America, 77% say defaults will rise in Asia,
covenants in credit documents have allowed around a consumer rebound so [sponsors] didn’t and more than 90% say defaults will jump in
sponsors to benefit from out of court proceedings really predict this. There is a correction due in the %UROPE
as they don’t require 100% creditor consent to market.” h)NmATIONûISûAûPROBLEMûINûMOSTûMARKETSû
enforce a restructuring. First-lien secured lenders Investors may switch to holding higher- ANDûCENTRALûBANKERSûAREûDETERMINEDûTOûSLOWû
can be pushed down to second or third in line for rating securities to offset their interest rate GROWTHûINûORDERûTOûCONTAINûRISINGûPRICESvû
their payments and lose their former safer status exposure, which could prompt a change in the said Som-lok Leung, executive director of
sitting at the top of the capital structure. way companies structure their debt to appeal to THEû)!#0-ûh)NûTHISûENVIRONMENTûOURû
“Private equity sponsors have successfully investors. MEMBERSûFULLYûEXPECTûTOûSEEûRISINGûDEFAULTSû
negotiated looser credit documents that “Investor tolerance for holding B3 risk may ANDûINCREASEDûLOSSESv
arguably enable a range of liability management also wane, driving more capital structures to The forecast for credit spreads over the
transactions to preserve equity,” said Christina achieve a B2 corporate family rating,” said next three months is negative as well, with
Padgett, head of leveraged finance research and Padgett. THEûOUTLOOKûMOREûNEGATIVEûINû%UROPEûTHANû
analytics at Moody’s. Aileen Suresh other parts of the world.
Seventy-seven percent of respondents
expect investment-grade spreads to widen in
GOODPACK LINES UP TLB REFI Industrial and Commercial Bank of China, Natixis %UROPEûWHILEûûSAYûINVESTMENT GRADEû
and Standard Chartered. RESPONDENTSûINû.ORTHû!MERICAûWILLûWIDEN
0RIVATEûEQUITYûGIANTû++2ûHASûMANDATEDûEIGHTû 4HEûNEWûlVE YEARûlNANCINGûWHICHûISû Similarly, 80% of respondents say
BANKSûONûAû53MûBORROWINGûTHATû TARGETINGû!SIANûBANKûLIQUIDITYûISûEXPECTEDûTOûBEû %UROPEANûHIGH YIELDûSPREADSûWILLûWIDEN
RElNANCESûAûSLIGHTLYûSMALLERûTERMûLOANû"ûITû split into a US$675m term loan and a US$150m The credit outlook survey is conducted at
HADûRAISEDûFORûBULKûCONTAINERûMANUFACTURERû REVOLVINGûCREDITûFACILITYû4HEû0%ûlRMûISûALSOû THEûBEGINNINGûOFûEACHûQUARTERûAMONGû)!#0-û
GOODPACKûINûû4HEûBANKSûAREûANZ, BDO looking to raise an additional US$200m through MEMBERSûFROMûûlNANCIALûINSTITUTIONSûINû
Unibank, BNP Paribas, Credit Agricole CIB, HSBC, SUBORDINATEDûDEBTûATûTHEûHOLDINGûCOMPANYûLEVEL 29 countries.

EQUITIES
Australia 60 China 60 India 61 Japan 61 Thailand 63 Finland 63 Germany 63
Norway 64 Saudi Arabia 65 UK 66 United States 67 Brazil 68
FRONT STORY RESTRUCTURING
CIFI scuppers sector rebuild

Chinese developer misses coupon payment just six months after selling note
CIFI HOLDINGS has defaulted on a convertible SHUT THE DOOR CIFI said it has been proactively engaging
bond issued just six months ago, making it %QUITY LINKEDûBANKERSûSAIDûTHEû#)&)ûDEFAULTû with relevant creditor groups to address the
one of the biggest Chinese developers to would completely shut the door for private payment delays and was progressing
become insolvent. Chinese developers to tap the CB market. towards “consensual solutions”.
The rapid slide into default shows that “CIFI is one of the private developers that The cross-default clause on CIFI’s US
even well-regarded real estate companies just sold a government-supported bond last dollar bonds will not be triggered unless
have seen liquidity dry up suddenly thanks month,” said one of the bankers. “Investors there is a default of more than US$30m on
to weak property sales and investors’ would think at least that means they have a other debt, according to a research note
aversion to the sector. certain kind of backing from the Chinese from Nomura. That means that the missed
CIFI issued the HK$2.545bn (US$325m) government. The CB default is the moment coupon did not trigger a cross-default, but
6.95% convertible bonds due 2025 via an of truth, telling global investors private the US dollar bonds would be in default if
initial HK$1.957bn issue and HK$588m tap developers are absolutely not something holders of more than 25% of the principal of
INû!PRILû4HEûlRSTûCOUPONûWASûDUEûONû that they should look at.” the CB accelerated payment.
October 8. CIFI’s offshore bond prices tumbled in late
China Construction Bank, the trustee for September, following reports saying that it
the CB, said in a note sent to bondholders “We have gone from a situation had defaulted on an onshore trust loan. The
that CIFI had not paid the coupon. Since of only weaker names being COMPANYûCONlRMEDûINûAû3EPTEMBERûû
there is no grace period, this is an event of affected to now major ones” statement that it had missed a payment on
default, according to the note. certain “non-standard” debt related to a
“We have gone from a situation of only project in China, and blamed poor market
weaker names being affected to now major On September 21, onshore subsidiary CIFI sentiment for the delayed development and
ones,” said a DCM banker. “We are right in Group issued Rmb1.2bn (US$167m) of three- sale of its projects for the situation.
the eye of the storm.” year 3.22% bonds with a full guarantee by The developer’s US$300m 5.5% 2023 bond
)NûAûlLINGûONûTHEû3TOCKû%XCHANGEûOFû(ONGû state-owned China Bond Insurance. Chinese dropped from a bid price of 83.625 on
Kong on Thursday, CIFI said it was late authorities selected relatively strong September 27 to 48 the following day, and
making certain interest and amortisation property companies including Longfor was trading at a cash price of 14 on Thursday
payments, but did not mention it had 'ROUPû(OLDINGSûANDû-IDEAû2EALû%STATEûTOû AFTERNOONûACCORDINGûTOû2ElNITIVûDATAû)TSû
defaulted. issue bonds with such guarantees to try to US$555m 6.55% 2024 notes and US$500m
The property company blamed the missed RESTOREûINVESTORûCONlDENCEûINûTHEûSECTOR 6.45% 2024s were trading at 25 and 22,
payments on a delay in remittance of cash )NûTHEû4HURSDAYûlLINGû#)&)ûSAIDûTHATûSOMEû respectively, on Thursday.
offshore from mainland China due to the media reports and market rumours related CIFI is one of three Chinese property
week-long holiday in China after the to its offshore debt were inaccurate, but did companies to have issued offshore
October 1 National Day. not give details or say what was inaccurate convertible bonds this year.
Since September, the company has been about them. CIFI’s warning to creditors and Country Garden Holdings sold a HK$3.9bn
downgraded by the three major ratings investors not to rely on market rumours or 4.95% 4.5-year non-put two CB in January,
agencies, which cited its weakened credit media reports shows “a degree of tone while Jiayuan International Group issued a
PROlLEûANDûRISINGûLIQUIDITYûRISKSû&ITCHû deafness”, analysts from Lucror Analytics HK$667m 364-day 8% CB in July through a
downgraded the issuer and its bonds to CC wrote in a note. “The company has not been self-led deal.
on October 11 before withdrawing the forthcoming with information. This has left Jiayuan missed a coupon payment due
ratings the next day, saying the company AûVOIDûTHATûSTAKEHOLDERSûHAVEûlLLEDûWITHû October 8 on its US$300m April 2023 bond
had chosen to stop participating in the whatever is circulating in the market,” said and has received winding-up petitions from
rating process. Previously, Moody’s and S&P the analysts. some creditors this year.
had lowered their ratings to B3 and B+, In the note that accompanied its It said it will not make the payment due
before S&P withdrew its rating this month downgrade decision, Fitch said it had been on its US$175.7m February 2023 notes on
at the company’s request. UNABLEûTOûCONlRMûORûDENYûREPORTSûTHATû#)&)û October 18 while it works on an exchange
A credit analyst said that the explanation had missed a payment on the CB because offer. The company has extended several
for the delay sounded like an excuse and the the company had declined to comment in times an exchange offer for six bonds and a
company might not have enough money to writing. consent solicitation for the bonds plus the
cover the payments. Meanwhile, Nomura The CB was bid at 10 cents on the dollar CB. The latest deadline is October 19.
analysts said in a note that they view an ONû&RIDAYûACCORDINGûTOû2ElNITIVûDATAûHAVINGû Investors’ attention has now turned to
exchange of CIFI’s US dollar bonds as all but been above 50 three weeks earlier. CIFI’s Country Garden. Its CB was bid at 43 cents in
inevitable, adding they expect further price shares fell 10.3% and are down 88% so far the dollar on Thursday, as its stock fell 9.8%.
declines amid heavy technical selling. this year. Jane Li, Fiona Lau

The company has started early discussions media platforms including Tmall, JD.com,
internally and externally with potential Douyin, Xiaohongshu and Pinduoduo.
ASIA-PACIFIC advisers for the restructuring of SINOPEC 'IANTû"IOGENEûPOSTEDûAûPROlTûOFû
MARKETING before taking it public. 2MBMû53M ûFORûTHEûlRSTûlVEû
A listing in Hong Kong is being months of 2022, up 8.3% year-on-year.
AUSTRALIA CONSIDEREDûALTHOUGHûAûlNALûDECISIONûHASûNOTû It completed a Rmb7.36bn pre-IPO round in
been made on the venue, according to two January at a valuation of Rmb19.4bn, bringing
NIB HOLDINGS SECURES FUNDING of the people. in investors including Hillhouse Capital and
Sinopec Marketing may raise at least CICC Healthcare Investment Fund.
Health and medical insurance company US$5bn from the IPO depending on market
NIB HOLDINGS has raised A$135m (US$84.9m) conditions, with the deal likely to happen as SICC PLANS SWISS GDR
from a fully underwritten institutional early as late 2023.
placement. Sinopec did not respond to emails seeking Shanghai-listed SICC is planning a global
Strong demand came from existing comment. depositary receipt offering in Switzerland
institutional shareholders and a number of 4HEûSTATE RUNûOILûlRMûlRSTûPROPOSEDûAû that could raise about US$300m, said people
new, high quality investors. listing of Sinopec Marketing in 2014 when it with knowledge of the matter.
It sold about 19.56m new shares at A$6.90 sold a 29.6% stake to 25 domestic and The maker of advanced materials for
each, or 4.3% of issued shares, at an 8.1% foreign investors for an aggregate amount of SEMICONDUCTORSûISûWORKINGûWITHûlNANCIALû
discount to the pre-deal close of A$7.51. Rmb107bn (US$14.9bn). advisers on the deal, which could come early
In addition, the company intends to In 2017, the company hired six banks to next year.
raise up to A$15m via a non-underwritten restructure Sinopec Marketing and targeted SICC, in which Huawei-backed Hubble
share purchase plan, which will run from to list it for up to US$10bn that year. The six Technology Investment owns a 6.34% stake,
October 19 to November 7. were China Merchant Securities, CICC, Citic raised Rmb3.56bn (US$497m) from a
Proceeds will be used to fund NIB’s entry Securities, Citigroup, Goldman Sachs and Shanghai Star IPO in January this year.
into the National Disability Insurance Morgan Stanley. Its shares rose 7.5% on Wednesday to
Scheme plan management sector via the As of June 30, Sinopec’s retail operations Rmb114.99, 39% above the IPO price of
acquisition of Victoria-based Maple Plan, included more than 30,700 fuel stations and Rmb82.79 and giving it a market
which has about 7,000 NDIS plan nearly 28,000 convenience stores, according capitalisation of Rmb49.4bn.
participants. TOûITSûlRST HALFûREPORTû3INOPECû-ARKETINGû
Founded in 1952, NIB Holdings provides POSTEDûAûNETûPROlTûOFû2MBBNûFORûTHEû LX TECH WINS LISTING APPROVAL
health and medical insurance to more lRSTûHALFûDOWNûûYEARûONûYEARû4HEûFULL
than 1.7 million Australians and New YEARûPROlTûINûûWASû2MBBN LX TECHNOLOGY has won listing approval for a
Zealanders as well as more than 180,000 Hong Kong IPO that people with knowledge
international students and workers in GIANT BIOGENE PRE-MARKETS IPO of the matter said could raise about
Australia. US$50m–$100m.
JP Morgan was the lead manager. GIANT BIOGENE has started pre-marketing a The JD.com-backed device-as-a-service
Hong Kong IPO of about US$500m with CICC (DaaS) provider is planning to start pre-
and Goldman Sachs as sponsors. marketing as early as this month if market
CHINA The skin treatment products maker uses conditions allow.
technology to develop and make multiple Haitong International is the sponsor.
SINOPEC REVIVES UNIT IPO PLAN types of recombinant collagen that are used The company provides computer rental,
in its products. IT technical services and device recycling
China Petroleum & Chemical Corp, more It sells its products to more than 1,000 services to enterprises.
commonly known as Sinopec, has revived public hospitals, 1,700 private hospitals and JD.com owns 13.2% of LX Technology,
plans to list the retail unit that runs its gas clinics, as well as about 300 pharmacy chain Tencent Holdings owns 1.88% and Lenovo
stations and convenience stores, said people brands across China. It also sells products 0.9%.
with knowledge of the matter. directly through e-commerce and social !CCORDINGûTOûANû!PRILûlLINGûTHEûCOMPANYû
posted a loss of Rmb449m (US$70m) in 2021,
ASIA-PACIFIC EQUITIES ASIA-PACIFIC EQUITIES (EX-JAPAN) compared with a loss of Rmb177m in 2020.
Managing No of Total Share Managing No of Total Share FLOWING CLOUD PRICES IPO AT BOTTOM
bank or group issues US$(m) (%) bank or group issues US$(m) (%)
1 Citic 101 19,742.80 10.0 FLOWING CLOUD TECHNOLOGY has priced its Hong
1 Citic 101 19,742.80 10.3
2 CICC 83 15,862.32 8.1 2 CICC 83 15,862.32 8.3 Kong IPO at the bottom of the indicative
3 China Securities 59 11,547.20 5.9 3 China Securities 59 11,547.20 6.1 price range to raise HK$600m (US$76m).
4 Huatai Securities 55 9,580.84 4.9 4 Huatai Securities 55 9,580.84 5.0 The company sold 271.5m shares for a
5 UBS 39 7,617.62 3.9 5 UBS 39 7,617.62 4.0 ûFREE mOATûATû(+ûEACHûTHEûBOTTOMû
6 Goldman Sachs 28 6,462.76 3.3 6 Goldman Sachs 28 6,462.76 3.4 of the HK$2.21–$2.88 range. The price
7 Haitong Securities 51 5,547.66 2.8 7 Haitong Securities 51 5,547.66 2.9 values it at HK$4bn and represents a 2023
8 Guotai Junan Secs 53 5,536.48 2.8 8 Guotai Junan Secs 53 5,536.48 2.9 0%ûOFû
9 Morgan Stanley 37 4,742.75 2.4 9 Citigroup 25 4,537.81 2.4 %STABLISHEDûINûû&LOWINGû#LOUDû
10 Citigroup 25 4,537.81 2.3 10 Morgan Stanley 26 4,035.67 2.1 mainly provides augmented and virtual
Total 2,002 196,713.63 Total 1,893 190,834.34 reality content and services to advertising
Including all domestic and international deals and rights issues Including all domestic and international deals and rights issues customers. It shifted its business focus from
Source: Refinitiv SDC code: C4a1 Source: Refinitiv SDC code: C4a2 games in 2017.

EQUITIES ASIA-PACIFIC
Five cornerstone investors invested Ambit, BNP Paribas, BoB Capital Markets, MITSUBISHI ESTATE LAUNCHES
Rmb167.3m (US$23.2m) in total: Anji Guorong HSBC, ICICI Securities, Jefferies and JM Financial PLACEMENT
Construction (Rmb50m), Anji Qicai Lingfeng are the banks on the transaction.
Rural Tourism Investment (Rmb50m), Both primary and secondary shares are MITSUBISHI ESTATE LOGISTICS REIT INVESTMENT has
Zhejiang Tianzihu Industry Investment likely to be sold. launched a ¥21.4bn (US$145.4m) primary
(Rmb50m), SensePower (Rmb13.86m) and Bank of Baroda owns a 65% stake in the follow-on, based on a minimum 2.5%
TradeGo FinTech (Rmb3.46m). life insurer, Union Bank of India 9% and discount to Friday’s close of ¥431,000 per
The shares are scheduled to start trading Carmel Point Investments India, a Warburg unit.
on October 18. 0INCUSûAFlLIATEû 4HEû2%)4ûWHICHûFOCUSESûONûTHEûTOURISMû
4HEûCOMPANYûPOSTEDûAûNETûPROlTûOFû industry and invests in logistics facilities, is
2MBMûFORûTHEûlRSTûTHREEûMONTHSûOFû ELECTRONICS MART PRICES IPO AT TOP offering 51,000 units in an indicative
2022, up 315% from Rmb9.2m a year earlier. discount range of 2.5%–5% to the market
Shenwan Hongyuan was the sponsor. ELECTRONICS MART INDIA has priced an IPO at the close on pricing day, of which 2,200 units
top of the Rs56–Rs59 range to raise Rs5bn will be sold to the sponsor, Mitsubishi
(US$61m). %STATEûINûTHEûDOMESTICûTRANCHE
INDIA The IPO was 71.93 times covered when There is a 2,550-units greenshoe.
books closed on October 7. There is a 90-day lock-up for the issuer
FABINDIA IPO FACES RESISTANCE Stock exchange data show the and a 180-day lock-up for the sponsor.
institutional tranche was covered 169.54 The offer will be sold to international and
Traditional wear and furniture retailer times, the high-net-worth-investor segment Japanese investors with a 35%/65% split.
FABINDIA is facing resistance from investors 63.59 times and retail 19.72 times. Bookbuilding runs from October 14 to 18
on the valuation for its IPO of up to Rs50bn Only primary shares were offered. and pricing is slated for October 19 at the
(US$607m), people with knowledge of the Proceeds will be used for capital earliest.
transaction said. expenditure and debt repayment. Proceeds will be used to part pay eight
It was targeting a market capitalisation of The top of the price range translates to a additional properties that the company
Rs250bn but demand is coming in at around 0%ûOFûûFORûTHEûlNANCIALûYEARûTHATûENDEDûINû anticipates acquiring.
Rs150bn, one of the people said. March. Morgan Stanley and SMBC Nikko are the joint
Volatile stock markets and uncertainty Anand Rathi Advisors, IIFL Securities and JM global coordinators. They are also Japanese
over global and local economic growth have Financial a re the lead managers. joint lead managers with Daiwa.
pushed down the valuation expectations. The electronics retailer’s revenue in FY2022
In a preliminary prospectus, the company was Rs43bn, up 34% from Rs32bn in FY2021. ADVANCE LOGISTICS PRICES FOLLOW-ON
said Rs5bn of primary shares and 25m .ETûPROlTûROSEûûTOû2SBNûFROMû2SM
secondary shares will be on offer. ADVANCE LOGISTICS INVESTMENT hasraised
The company was aiming to launch the ¥9.88bn (US$67.7m) from a follow-on
IPO this year. JAPAN offering of units priced at ¥139,620 each.
The vendors include controlling 4HEû2%)4ûSOLDûûUNITSûATûAûû
shareholders Bimal Nanda Bissell and other GLP J-REIT SEEKS FOLLOW-ON discount to October 12’s market close of
members of the Bissell family, as well as ¥143,200. This was at the tight end of the
investor shareholders PI Opportunities GLP J-REIT plans to raise ¥32.7bn 2.5%–5% discount range.
Fund, Prazim Trading, Bajaj Holdings and (US$223.9m) from a primary follow-on, There is a 3,500-units greenshoe.
Kotak India Advantage Fund. based on a minimum 2% discount to the Daiwa and Mitsubishi UFJ Morgan Stanley
FabIndia is planning a pre-IPO placement market close of ¥158,100 on October 12. were the joint lead managers.
of Rs1bn and if completed the primary 4HEû2%)4ûWHICHûMAINLYûINVESTSûINû
component of the IPO will be reduced logistic facilities and related real estate
accordingly. properties in Japan, is looking to offer SOUTH KOREA
2EVENUEûINûTHEûûlNANCIALûYEARûFELLû 211,210 units in an indicative discount
30% to Rs10.6bn from Rs15.1bn. It reported range of 2%–4.5% to the market close on LIONHEART, GOLFZON POSTPONE FLOATS
a net loss of Rs1.17bn compared with a pricing day.
PROlTûOFû2SMûINû There is a 10,561 units greenshoe. Online games developer LIONHEART STUDIO and
Credit Suisse, Equirus, ICICI Securities, JP There is a 90-day lock-up for the issuer golf equipment distributor GOLFZON COMMERCE
Morgan, Nomura and SBI Capital are the lead and a 180-day lock-up for GLP Capital Japan HAVEûPOSTPONEDû+OREAû%XCHANGEû)0/SûOFûAû
managers. 2 Private Limited and GLP Capital GK. combined W704bn (US$491.7m), saying that
FabIndia is one of India’s largest private The offer was being sold to international MARKETûCONDITIONSûHAVEûMADEûITûDIFlCULTûFORû
platforms for products that use traditional and domestic investors with a 45%/55% investors to value the companies properly.
techniques and fabric. It links more than split. Lionheart Studio planned to sell 11.4m
55,000 craft based rural producers to urban Bookbuilding closed on October 14 and shares (87.7% primary/12.3% secondary) in a
markets and has over 300 stores in India and pricing is slated for October 17 at the W36,000–W53,000 range. It had started pre-
overseas. earliest. marketing on October 4 and was due to
0ROCEEDSûWILLûBEûUSEDûTOûPARTûPAYûlVEû complete the exercise on Friday, with
INDIAFIRST TO FILE FOR IPO THIS MONTH additional properties and the remaining international bookbuilding scheduled for
30% co-ownership interest in GLP Zama. October 17–31.
INDIAFIRST LIFE INSURANCE PLANSûTOûlLEûFORûAû Nomura, Mizuho, SMBC Nikko and Morgan The IPO of up to W604.2bn would have
US$200m–$250m domestic IPO as early as Stanley were joint lead managers and been the second-largest this year on KRX
this month, people with knowledge of the international joint lead managers with behind electric vehicle battery maker LG
transaction said. Citigroup. %NERGYû3OLUTIONSû7TRNûmOATûINû*ANUARYû

W12,700 each in its up to W100bn IPO.
Socionext cheers IPO hopefuls Bookbuilding ran on October 11–12. The

retail subscription was scheduled to run on
October 18–19.
JAPAN More sizeable floats may come before year-end The selling shareholder was Golfzon
Newdin Holdings, which holds a 97% of the
Chip company SOCIONEXT made a strong trading and Panasonic Holdings, designs, develops company.
debut after it raised ¥66.8bn (US$457.3m) from and sells custom systems-on-a-chip and offers There was a voluntary lock-up of between
Japan’s largest IPO this year, lifting the spirits of related services. SoCs are highly complex 15 days and six months.
other IPO hopefuls following a lacklustre year. logic chips that combine the components and The company planned to sell 65%–70% of
Its shares closed at the day’s high of ¥4,200 functionality of a computer or electronic system the shares to institutional investors, 25%–
on Wednesday, up 15.1% from the IPO price of on a single chip. 30% to retail and up to 5% to an employee
¥3,650 , and had risen by 21% from the IPO price Existing shareholders Development Bank of stock ownership plan.
when they ended the week at ¥4,420. Japan, Fujitsu and Panasonic were the vendors of Founded in 2015, Golfzon mainly sells
“Investors who participated in the deal are the secondary shares. There is a 15% greenshoe GOLFûEQUIPMENTûTHROUGHûONLINEûANDûOFmINEû
making money,” a Japanese ECM banker said. of up to 2.74m shares. channels.
“The debut performance looks decent under SMBC Nikko and Nomura were the joint global Korea Investment and Securities was running
current market conditions, and if the share price coordinators. THEûmOAT
continues to perform well in the near term, it will
definitely bring some encouragement to the IPO YEAR-END HOPEFULS BIONOTE PLANS IPO NEXT MONTH
market.” At least three sizeable floats from digital bank
Equity and equity-related issuance in Japan SBI SUMISHIN NET BANK, semiconductor equipment Animal health diagnostics maker BIONOTE is
has fallen 79.6% year-on-year to US$6bn in the manufacturer KOKUSAI ELECTRIC and online bank planning to open books next month for a
year to-date, according to Refinitiv data. RAKUTEN BANK could come to the market before +OREAû%XCHANGEû)0/ûOFûUPûTOû7BNû
Socionext drew strong support from the end of this year following Socionext’s strong (US$200m).
institutional investors by offering an attractive debut. Bionote is offering 13m shares (10.4m
valuation versus its peers. SSNB said on October 7 it had filed a primary/2.6m secondary) in an indicative
The deal was upsized to 18.3m secondary preliminary TSE listing application, after it price range of W18,000–W22,000.
shares, from 11.82m, and priced at the top of the had dropped a planned ¥115.5bn IPO in March It plans to sell 55%–75% of the shares to
indicative price range of ¥3,480–¥3,650. because of market volatility following Russia’s institutional investors, 25%–30% to retail and
The issue price represented a forward P/E of invasion of Ukraine. up to 20% to an employee stock ownership
5.7 times for the financial year ending March It did not give the deal size or timetable for the plan.
2024, cheaper than the company’s peers in revived IPO, but ECM bankers away from the deal Pre-marketing will run from October 26 to
Japan, Taiwan and the US, which have average generally believe it will be smaller than its last November 7 and the bookbuilding will run
forward P/E ratios of 9.2x, 17.8x and 12.3x attempt, when it was on course to complete the from November 7 to 8 with pricing slated for
respectively, analyst Clarence Chu said on country’s largest float in more than three years. November 9. The retail subscription will run
September 27 in a report published on research “It depends on what price is set this time; from November 10 to 11.
portal Smartkarma. small and cheap is the best strategy in such a Company chairman Young-sik Cho is the
The international tranche was about 15 market,” a Japanese ECM banker away from the largest shareholder with a 54.2% stake. He is
times covered with more than 130 investors deal said. “If the deal has the same size and also the largest shareholder of Covid-19 test
participating. The domestic retail tranche was valuation, it will be a challenge to get the deal kit maker SD Biosensor, which raised
covered about 14 times and institutional tranche through.” W647bn last year in a KRX IPO, with a
about seven times. The top 20 investors took Kokusai Electric, which was spun off from 31.56% stake.
about 80% of the stock and long-only funds took Hitachi Kokusai Electric in 2018, has hired Founded in 2003, Bionote mainly
more than 60%. SMBC Nikko, Nomura and Goldman Sachs for manufactures test kits and diagnostic
“The sharp spike on increased volumes at the its potential listing in December, according to analysers for animal health. It posted an
end of trading on Wednesday could be indicative DealWatch, IFR’s sister publication. OPERATINGûPROlTûOFû7BNûINûTHEûlRSTûHALFû
of still more demand for the stock,” Brian Freitas, If the market remains stable, the deal of 2022, compared with W375.5bn a year
an analyst at Periscope Analytics, wrote in a size could be bigger than the Socionext IPO, earlier.
report published on Smartkarma. according to people familiar with the transaction. NH Investment & Securities and Korea
He said the stock is set for more gains in the Japanese ECM bankers expect the online Investment & Securities AREûLEADINGûTHEûmOAT
near term as it is expected to be added to the banking unit of Japanese e-commerce giant
Topix index at the end of November. Rakuten Group to raise up to US$1bn from its IPO. JEIO RESCHEDULES IPO
Socionext, which was founded in 2015 from Goldman Sachs and Daiwa are leading the float.
the merger of the chipmaking units of Fujitsu Sunny Tse %NGINEERINGûCOMPANYûJEIO has deferred its
KRX IPO of up to W147.4bn (US$102.8m) to
November.
The selling shareholders included company combined 54.94% stake in the company, while Bookbuilding will run from November
development director Han-soon Lee and art ,IONHEARTû#%/û*AEûYOUNGû+IMûHOLDSû 4–7 instead of October 19–20 and the pricing
director Beom Kim. The company planned to Korea Investment and Securities, JP Morgan, will be on November 8. The retail
sell 69.61%–74.61% of the shares to NH Investment and Securities and Goldman Sachs subscription will run from November 9–10.
institutional investors, 25%–30% to retail and were leading the transaction. The deal size and indicative price range
0.39% to an employee stock ownership plan. Golfzon Commerce was marketing 7.86m are unchanged. The company is offering
Kakao Games and its wholly-owned shares (4.33m primary/3.53m secondary 8.19m primary shares in a range of
SUBSIDIARYû+AKAOû'AMESû%UROPEûHOLDûAû shares) in an indicative range of W10,200– W15,000–W18,000.

EQUITIES EMEA
It plans to sell 61.9%–66.9% of the shares

to institutional investors, 25%–30% to retail GERMANY
investors and 8.1% to an employee stock EUROPE/MIDDLE
ownership plan. EAST/AFRICA PORSCHE IPO SPEEDS TO €9.08bn
#%/û$EUK JUû+ANGûISûTHEûLARGESTû
shareholder with a 33% stake. PORSCHE’s IPO has raised €9.08bn for parent
&OUNDEDûINûû*%)/ûPRODUCESûBATTERYû FINLAND Volkswagen after the remaining greenshoe
materials such as carbon nanotubes and was exercised on Tuesday following nearly a
offers engineering and plant construction VALMET TARGETS GROWTH WITH €140m IPO week without intervention from
services. stabilisation manager Bank of America.
Korea Investment and Securities is leading the Finnish vehicle contract manufacturer 4HEûlNALûSIZEûCONlRMSûTHEû'ERMANû
mOAT VALMET AUTOMOTIVE has kicked off pre- COMPANYSû)0/ûASûTHEûLARGESTûINû%UROPEûFORû
marketing for a €140m all-primary IPO with more than a decade, since Glencore’s
half the deal already covered by two pension US$10bn deal in 2011, and the seventh-
THAILAND funds. LARGESTûEVERûINû%-%!ûDESPITEûCHALLENGINGû
Cornerstone commitments are from conditions around the world.
BETAGRO CLOSES IPO BOOKS EARLY Varma Mutual Pension Insurance Company The shares are above the €82.50 issue
for €40m and €30m from Ilmarinen Mutual price but have yet to settle, falling to €87.30
BETAGRO has closed books early for its Bt17.4bn Pension Insurance Company. Those on Monday and to €83.60 on Tuesday,
(US$458m) IPO, a person with knowledge of commitments cap the pre-money valuation shedding 9.2% in two days. On Friday, the
the transaction said. Books are multiple times of Valmet at €280m. stock was up nearly 3% to €89.24.
covered and were scheduled to close on Friday 4HATûVALUATIONûPOINTSûTOûAûFREE mOATûOFû As 3.8m preferred shares were bought
rather than Monday as originally planned. one-third and market capitalisation at during stabilisation, just over 11m shares
The agro food conglomerate is selling listing of €420m. WEREûEXERCISEDûTOûTAKEûTHEûlNALû)0/ûPROCEEDSû
MûSHARESûFORûAûûFREE mOATûATû"Tû Valmet is launching its IPO in a very quiet TOûõBNûANDûTHEûFREE mOATûOFûTHEûPREFSûTOû
each. There is a 15% greenshoe of 65m PERIODûFORû%#-ûANDûISûTHEûONLYûLIVEûDEALûINû 24.2%, and 12.1% of the carmaker.
shares. Cornerstone investors are buying %UROPEû"ANKERSûINVOLVEDûREPORTEDûAûLOTûOFû "ANKûOFû!MERICAûACTIVELYûBOUGHTûONûTHEûlRSTû
shares totalling Bt7.3bn. The price implies a interest, particularly locally as the company three days of trading following their debut on
price/earnings multiple of 9 for 2023. is well known in Finland and the Nordics. September 29, with stabilisation ending with
The shares start trading on November 2. “We had an extensive early look exercise the purchase of less than 100 shares on the
Proceeds will be used to fund expansion and so there has been good visibility,” one said. fourth day of trading on October 4. The
repay debt. Another described Valmet as entering a stabilisation was successful with minimal
The family-controlled agro-food transformative phase with a switch towards purchases needed to keep the stock close to
conglomerate, founded in 1967, produces HIGHERûGROWTHûANDû%6ûSYSTEMSûWITHûTHEûlRMû the issue price before natural buying came in.
poultry and pork sold under the S-Pure brand, wanting to capitalise on its high market share. The IPO attracted massive demand following
as well as animal feed and farm equipment. According to bankers involved valuation high engagement from investors. It priced at
Betagro posted revenues of Bt53bn for the WILLûUSEû%6%BITûANDûLIKELYûTAKEûPLACEûONûAû the top of the range and has traded up in a
lRSTûHALFûOFûûUPûûFROMû"TBNûAûYEARû sum-of-parts basis given its involvement in DIFlCULTûMARKETûSOûBANKERSûWILLûFEELûTHEYûHAVEû
EARLIERû.ETûPROlTûROSEûûTOû"TBNûFROMû manufacturing and assembly as well as earned the incentive fee on the transaction.
Bt1.2bn. electric vehicle systems. Volkswagen agreed a base fee of just 0.6%
Bank of America, Bualuang Securities and Canadian car parts manufacturer Magna for the IPO, which works out to a pot of
Kiatnakin Phatra are the banks on the IPO. International and Swedish pump around €31.2m, once removing the €3.88bn
manufacturer Concentric are considered cornerstone tranche. Four global coordinators
THAI CREDIT ADDS BANKS TO IPO potential peers for the assembly and are taking 70% of the pot, about €5.5m each.
manufacturing segment. Bank of America, Citigroup, Goldman Sachs and JP
-ICROlNANCEûLENDERûTHAI CREDIT RETAIL BANK has -AGNAûTRADESûATûû%6%BITDAûWHILEû Morgan will be hoping to top that up
added CIMB and Maybank to the syndicate of Concentric trades at 10.3. substantially with the 0.4% incentive fee.
its US$300m–$400m IPO, people with &ORûû6ALMETûPOSTEDû%BITDAûOFûõMû
knowledge of the transaction said. and net sales of €570m. EMEA EQUITIES
Bualuang Securities was already working on By 2025–26 it aims to achieve net sales of BOOKRUNNERS: 1/1/2022 TO DATE
the transaction, expected early next year. õBNûWITHûûCOMINGûFROMûITSû%6ûSYSTEMSûLINE Managing No of Total Share
Thai Life Insurance, which recently listed Proceeds will be used for capex, including bank or group issues US$(m) (%)
ONûTHEû3TOCKû%XCHANGEûOFû4HAILANDûANDû ELECTRIlCATIONûTECHNOLOGYûWITHûTHEû 1 Goldman Sachs 37 6,729.17 9.6
Olympus Capital Asia are among the bank’s company also hoping the deal will raise its 2 Citigroup 27 5,248.40 7.5
shareholders. visibility. 3 Bank of America 20 3,796.42 5.4
Founded in 1970 and granted a retail The IPO is likely to follow a standard two- 4 HSBC 13 3,498.64 5.0
banking licence in 2006, Thai Credit plus-two timetable, meaning books could 5 Morgan Stanley 23 3,344.49 4.8
PROVIDESûlNANCIALûSERVICESûTOûSMALLû open by the end of the month with a result 6 BNP Paribas 22 2,698.98 3.9
businesses, wet market vendors, small by mid-November. 7 JP Morgan 20 2,549.05 3.6
traders, food stall owners and other self- Pre-IPO ownership is split between three 8 Barclays 20 2,394.38 3.4
employed individuals. investors. Finnish Industry Investment has 9 Deutsche Bank 13 2,320.78 3.3
Total income in the second quarter of this 38.46%, as does Pontos Group, and China’s 10 Jefferies 27 1,812.97 2.6
year was Bt2.7bn (US$71m), up 23% from Contemporary Amperex Technology has 23.08%. Total 542 69,930.18
"TBNûINû1ûû.ETûPROlTûROSEûûTOû Carnegie is global coordinator, and joint Including all domestic and international deals and rights issues
Bt860m from Bt368m. bookrunner with Swedbank/Kepler Cheuvreux. Source: Refinitiv SDC code: C4cr

Incentive fees are discretionary and can A similar group of investors backed mean it cannot increase its stake. It made that
be paid in any proportion the client wishes Immatics’ merger with biotech VC commitment in June, and banks have been
and need not be distributed equally. Perceptive Advisors’ Arya Sciences WORKINGûONûlNDINGûINVESTORSûTOûBUYûTHEûRESTû
Senior bookrunners BNP Paribas, Deutsche Acquisition in July 2020. A banker at one of the bookrunners said a
Bank and Morgan Stanley earned 5% of the Immatics shares jumped 11.6% to US$11.26 LOTûOFûEFFORTûHADûBEENûMADEûTOûlRMûUPû
fee pot, with the remaining bookrunners on Monday on volume of 1.2m shares, demand ahead of launch and it was a good
Barclays, Santander, Societe Generale and highlighting the stock’s thin liquidity. sign to have commitments already, showing
UniCredit earning 3.75% each. Since going public, the biotech has there was a perception of value.
Co-lead managers Commerzbank, Credit funded drug development through a series Global coordinators Bank of America,
Agricole, LBBW and Mizuho, and UBS, which of collaborations, including an agreement Citigroup, Credit Suisse and Mediobanca and
handled sales in Switzerland, have inked with Bristol Myers Squibb in joint bookrunners Barclays, Santander, Societe
separately agreed fees with VW. December last year that came with a Generale and Stifel have agreed to underwrite
US$150m upfront cash payment. €807m, with Algebris Investments
BAUER PREPARING LARGE CAPITAL The registered direct offering adds to guaranteeing another €50m.
INCREASE Immatics’ US$300m-plus of cash, which the Other investors have committed €37m,
biotech said was enough to last through the and in total there is sub-underwriting for
'ERMANûCONSTRUCTIONûANDûMACHINERYûlRMû second half of 2024. more than 50% of the rights issue, excluding
BAUER is preparing a two-thirds capital Alongside the offering, Immatics reported the state commitment, from strategic
INCREASEûTOûIMPROVEûITSûlNANCES interim results from a Phase I trial showing investors, pensions funds, domestic money
The company’s market capitalisation is proof-of-concept for its lead drug for and credit funds.
€171.7m and the fundraising is likely to patients with skin, ovarian, head/neck “A lot of work has been done lining up
raise more than €100m. cancers and other types of solid tumours. those counterparties as you can’t go into
The deal will see 17.39m new shares 4HEûlRSTûûPATIENTSûEXPERIENCEDûMINIMALû something like this blind,” said a third
issued on top of 26.09m outstanding. side effects at the initial dose, and some are banker involved, adding that announcement
%XPRESSIONSûOFûINTERESTûHAVEûALREADYû already responding positively to treatment. of the sub-underwriting could generate
come from major shareholder Doblinger, Immatics plans to start dosing patients at more interest.
which has a stake of nearly 30% and said it higher levels over the next 12 weeks. Memories of the €2bn rights issue by Saipem
will participate beyond that level, which The biotech expects to report Phase Ib are still fresh, with underwriters on that
could result in Doblinger acquiring control trial results in 2023. recapitalisation – including some that are
of the company. In that case German underwriting BMPS – in July collectively
regulations will require it to publish the owning 29.3% of the Italian oil services
acquisition of control and make a ITALY company when investors largely steered clear
mandatory offer for all outstanding shares. of the deal. That holding cost €592.3m and
The Bauer family is the largest SUB-UNDERWRITING SOOTHES BMPS shares are now 35% below the rights issue price.
shareholder with a stake of just over 36%. €2.5bn RIGHTS ISSUE The second banker said the level of
The capital raise will be put to a fundamental demand separated the deal from
SHAREHOLDERûVOTEûATûANû%'-ûONû.OVEMBERû BANCA MONTE DEI PASCHI DI SIENA has launched its Saipem which only had two shareholder
Bauer plans to use the proceeds to long-awaited €2.5bn rights issue with COMMITMENTSûFORûAûTOTALûû%VENûSOû3AIPEMû
increase its equity base and strengthen its substantial commitments secured, giving was on a comparatively light 95-for-1 basis
balance sheet. BANKSûTHEûCONlDENCEûTOûUNDERWRITEûTHEûLû (but in reality also a very heavy ratio) while
The shares traded as high as €6.72 atest recapitalisation of the beleaguered PRICINGûWASûAûûDISCOUNTûTOû4%20û
following Monday’s announcement but Italian bank. “We wouldn’t have gone forward [if we
softened slightly during the week, trading at The fundraising is around 10 times the WERENTûCONlDENT=vûHEûSAID
€6.58 just after 11am in London on Friday. bank’s market capitalisation of €256m, as of “Once you whittle away the commitments
The shares are down 33.54% year-to-date. Wednesday’s €25.58 close, such that shares and the government piece to the amount
No banks have yet been named on the are being offered at €2 each on a 374-for-3 each bank is individually underwriting, the
deal, though UniCredit was sole global basis for a maximum of 1.25bn shares on sums look a lot smaller,” said the head of
coordinator on a rights issue in 2021 that top of the outstanding 10.02m. syndicate. “Against the fees, it begins to
raised €64.1m. The heavy subscription ratio means that make sense.”
€2 per share is a massive gross discount but Subscription runs from October 17–31
IMMATICS TAKES DIRECT APPROACH AûTIGHTûûDISCOUNTûTOû4%20ûOFûõûBASEDû with rights trading from October 17–25.
TO FUNDRAISING on the closing price on October 11. By Any rights unexercised will be auctioned
Thursday’s close of €17.102, having fallen by ONû%URONEXTû-ILANûONû.OVEMBERûn
IMMATICS, a Nasdaq-listed German biotech AûTHIRDûDURINGûTHEûSESSIONûTHATû4%20û
which went public via a SPAC merger two discount had shrunk to 5.7%.
years ago, secured US$110m early on Shares continued down sharply on Friday, NORWAY
Monday via a registered direct offering. with trading halted twice, and shortly
Jefferies and SVB Securities placed 10.9m before 2pm in London were down over 36% CADELER RAISES FUNDS FOR
Immatics shares at US$10.09, no discount at €10.90. ANOTHER VESSEL
to the previous week’s close, and leaned h)TSûAûTIGHTûDISCOUNTûTOû4%20ûBUTûWEûHAVEûFEESû
on traditional biotech VCs to support that are commensurate with that risk,” said a Oslo-listed Danish wind turbine business
THEûDEALû%CO2û#APITALû0ERCEPTIVEû head of syndicate at an underwriting bank. CADELER raised NKr1.018bn (US$95m) in an
Advisors, RTW Investments, Samsara The Italian government has agreed to accelerated bookbuild on Wednesday
"IOCAPITALûANDû3OlNOVAû)NVESTMENTSûALLû maintain its 64.23% stake in the bank and will evening, with proceeds expected to fund a
participated. contribute up to €1.6bn, though state aid rules new installation vessel.

EQUITIES EMEA
Cadeler raised NKr846m in early

-AYûTOûlNANCEûTHEûDOWNûPAYMENTûONû
ITSûlRSTûDEDICATEDûFOUNDATIONûVESSELûTOû
be built by Cosco Shipping Heavy
Romania tries to keep
Industry and delivered in Q4 2025. The
agreement with Cosco included an option Hidroelectrica at home
for another F-class vessel, and discussions
are under way for Cadeler to exercise the EUROPE State prefers local only listing while fund is pushing for dual exchange IPO
option.
The expected cost is US$335m–$355m, The Romanian government will ask Fondul Another banker said US$2bn–$2.5bn was what
with delivery expected in July 2026. Proprietatea shareholders to vote on an IPO of he had heard regarding the IPO and said that
A capital increase launched around the power producer HIDROELECTRICA with a listing “there is no question that there is money across
close on Wednesday, with coverage at only on the Bucharest Stock Exchange. emerging market funds that want to invest in
launch on indications from a wall-crossing The vote will take place during the fund’s places like Romania but you will always attract the
that took placing during the day. EGM on November 15. The fund had planned bigger tickets with an international listing”.
In total, 32.85m new shares were placed, to ask shareholders to vote on a dual listing for Reuters said that Dan expects the fund to
representing 19.94% of existing capital. Hidroelectrica in Bucharest and an international meet government officials within the next few
Pricing came at NKr31, a 7.5% discount to exchange. weeks alongside initial pilot-fishing meetings for
the NKr33.50 close. Proprietatea is listed in Bucharest with GDRs the float.
The May trade was for 18.9% of share trading in London. “Even if it’s only a Bucharest listing, we are
capital and priced at NKr32.32, a 5% The Romanian government has a 5.8% committed to continue with the process and
discount at the time. stake in Fondul Proprietatea and owns 80% finalise it as soon as possible. That being said,
BW Altor was allocated 6.9m shares and of Hidroelectrica, the rest being held by we are not a seller of Hidroelectrica at any price,”
has a 30.3% post-money stake, down Proprietatea. Hidroelectrica has been an IPO Dan told Reuters. “We will try to complete the
slightly from 32.15% ahead of the trade. candidate since 2008. listing of Hidroelectrica as soon as possible, but
The allocation represents 21% of the Fondul Proprietatea is run by investment from where we are today, the optimal window of
capital raise, with BW Altor having manager Franklin Templeton, which spoke to opportunity looks to be March–April.”
committed at launch for at least 20% of the Reuters on Tuesday regarding the IPO. The agenda item added by the Romanian
offering. BW Altor also invested in the May “There are question marks surrounding the government also said that funds from the
trade to maintain its position. ability to sell 15% of Hidroelectrica in a local secondary IPO would be distributed to Fondul
Cadeler shares are down 8.1% this year listing only,” said Marius Dan, deputy CEO of Proprietatea shareholders as a special dividend
as of Wednesday and fell another 10% on Franklin Templeton. “In order to complete an IPO within three months of the float.
Thursday to close at NKr30. on the Bucharest Stock Exchange, the deal may Local reports have suggested a banking
On Friday afternoon, the shares were have to be downsized by anywhere from €1bn to syndicate of Citigroup, Morgan Stanley, Erste,
lower at Nkr29.86. €1.5bn.” Jefferies, Bank of America, Barclays, UBS,
DNB Markets, Pareto Securities and UniCredit and Wood.
SpareBank 1 Markets were joint BIG DEAL Sphera Franchise Group completed a
bookrunners. A spokesperson for Fondul Proprietatea Romanian IPO of L285.07m (US$56m) in
had previously estimated the valuation of October 2017, following Digi Communications’
Hidroelectrica at more than US$10bn, leading to L869.76m IPO in May. A just under US$50m
SAUDI ARABIA expectations for a roughly US$2.5bn deal. float for Moldova’s Purcari Wines was completed
A banker involved said that a Hidroelectrica in Bucharest in February 2018, and a US$100m
ARABIAN DRILLING IPO AMASSES IPO would likely total billions of dollars but said IPO for Electrogroup Infrastructure was cancelled
US$43.5bn OF ORDERS that US$2.5bn sounded “theoretical rather than at the end of that year.
realistic”. A dual listing would open the float to The most recent dual listing was power utility
3AUDIûOILlELDûSERVICESûGROUPûARABIAN “a wider international buying audience” but “with Electrica, which priced a L1.95bn sale of shares
DRILLING has drawn demand of close to these kinds of markets a lot of demand does tend and London-listed GDR in July 2014.
SR163bn (US$43.5bn) in the institutional to come from domestic names”. Robert Venes
leg of its SR2.67bn (US$712m) IPO.
0RICINGûWASûCONlRMEDûONû7EDNESDAYûATû
the top of the SR90–SR100 range. MARAFIQ GUIDES TO TOP FOR There is pro rata selling by Saudi’s Public
Institutional bookbuilding opened on US$895m FLOAT Investment Fund, the Royal Commission
September 28 and the deal was covered of Jubail and Yanbu, Sabic and Saudi
within hours. Guidance towards the top of MARAFIQ, or Power and Water Utility Aramco.
the range came on October 4 and books Company for Jubail and Yanbu, guided Bookbuilding began on Sunday, October
closed the following day. towards the top of the range for its 9 and was covered throughout the range
Demand from institutions is 61 times up to US$895m Tadawul IPO on within a few hours
the shares on offer. Thursday. The institutional bookbuild was due to
A retail offer for up to 10% of the IPO Messaging said that orders below close at 1pm in London on Friday. A retail
OPENSûONû/CTOBERûnûlNALûALLOCATIONSû SR46 per share risk missing out offer for a larger-than-typical 30% of the
are on October 25, and a trading date will from guidance of SR41–SR46 on an mOATûISûSETûFORû/CTOBERûnûWITHûlNALû
follow. offering of 73m secondary shares, allocations on November 2. A trading date
Goldman Sachs, HSBC and SNB Capital are REPRESENTINGûûFREE mOATû is yet to be set.
JOINTûBOOKRUNNERSûANDûJOINTûlNANCIALû At SR46, the deal would be SR3.36bn HSBC and Riyad Capital are joint
advisers. (US$895m). BOOKRUNNERSûANDûlNANCIALûADVISERS

ECM DEALS: WEEK ENDING 14/10/2022
Stock Country Date Amount Price Deal type Bookrunner(s)
NIB Holdings Australia 13/10/2022 A$135m A$6.90 Follow-on (Primary) JP Morgan
Cameco Canada 11/10/2022 US$650.0m US$21.95 Accelerated bookbuild (Primary) CIBC CM, Goldman Sachs
Cadeler Denmark 12/10/2022 NKr1.02bn NKr31 Accelerated bookbuild (Primary) DNB Markets, Pareto Secs, SpareBank 1 Markets
Electronics Mart India India 07/10/2022 Rs5bn Rs59 IPO (Primary) Anand Rathi, IIFl Securities, JM Financial
Advance Logistics Investment Japan 12/10/2022 ¥9.9bn ¥139,620 Follow-on (Primary) Daiwa, Mitsubishi UFJ Morgan Stanley
Kenedix Retail REIT Japan 13/10/2022 ¥5.1bn ¥256,312 Follow-on (Primary) Daiwa, Nomura and Mizuho
SBI Leasing Services Japan 11/10/2022 ¥6.6bn ¥2,980 IPO (Primary/Secondary) Daiwa, Mizuho, SBI
Securitas Sweden 11/10/2022 SKr9.6bn SKr46 Rights issue Carnegie, Citigroup, SEB
MCH Group Switzerland 10/10/2022 SFr76.9m SFr4.75 Rights issue N/A
Business First Bancshares US 12/10/2022 US$50.0m US$20.00 Accelerated bookbuild (Primary) Stephens
Dice Therapeutics US 12/10/2022 US$300.0m US$36.50 Follow-on (Primary) BofA, SVB Secs, Evercore, Guggenheim Secs
Spring Valley Acquisition II US 12/10/2022 US$200.0m US$10.00 SPAC IPO Citigroup, Guggenheim Secs
TenX Keane Acquisition US 12/10/2022 US$60.0m US$10.00 SPAC IPO Maxim Secs
rises to 37.5% from 33.3%, with another 1.5% Books closed on October 7 for the £200m
SWEDEN held by the Canton and the City of Zurich. deal, with Monday’s announcement
MCH Group had previously expressed referring to a “pause” in the IPO.
SECURITAS SECURES BROAD BACKING pessimism about the capital raise, referring to The trust blamed deteriorating market
the potential for the deal to be fully subscribed conditions since launch and the board said it
There was no shortage of demand for ASûANûhUNLIKELYûEVENTvûANDûINûAûlLINGûONû4UESDAYû WOULDûBEûBENElCIALûTOûATTEMPTûTHEû)0/ûATûAû
SECURITAS’ SKr9.6bn (US$853m) rights issue the board said it was delighted with the result. later date.
with 99% of rights exercised for a total of Proceeds will go towards repayment of a Chair Andy Crossley described it as a
206.2m new shares. SFr100m bond due in May. “challenging time for institutional investors
Demand without rights for a further No rump placing is planned and the new to make new investments, no matter how
203.7m shares left the deal just shy of twice shares will begin trading on October 13. attractive the offering”.
covered in total. On Friday they remained above issue, 4HEû,ONDONûmOATûWOULDûHAVEûGIVENû
The deal was announced alongside the trading at €4.83 shortly before 12.30pm in investors exposure to US farming, with the
acquisition of Stanley Black & Decker’s London. trust investing in a portfolio of more than
electronic security arm in December so had US$2.2bn of assets managed by
a very long lead time to engage investors. International Farming Investment
New shares were offered on a 4-for-7 basis UAE Management across 18 US states as well as
at SKr46 each, a hefty 38.7% discount to Australia and Chile.
4%20ûOFû3+RûBASEDûONûTHEû3EPTEMBERû BURJEEL RISES 15.5% AFTER Good feedback had been received from
12 close of SKr91.62. A banker on the deal US$300m IPO investors, but a banker involved said things
said, when terms were set, that the higher were tough for investment trust funds and the
THANûAVERAGEû4%20ûDISCOUNTûFORûANû BURJEEL HOLDINGS shares closed up 15.5% on their deal would need to return in calmer conditions.
ACQUISITIONûlNANCINGûREmECTEDûTHEûVOLATILITYû trading debut on Monday on the Abu Dhabi Liberum was bookrunner.
of markets. 3ECURITIESû%XCHANGEûFOLLOWINGûTHEûHEALTHCAREû
Shares closed at SKr81.84 on October 11, company’s Dh1.1bn (US$300m) IPO. HARMONY MANAGES SMALL FUNDRAISE
when subscription ended, and were trading The shares opened at Dh2.31 after pricing
around SKr84.30 on Friday afternoon, well at the bottom of the Dh2–Dh2.45 IPO range. HARMONY ENERGY INCOME TRUST raised just £15m
ABOVEûTHEû4%20ûCitigroup and SEB were joint They hit a high of Dh2.40, before returning in a follow-on offer after originally targeting
bookrunners with Carnegie as co-bookrunner. to Dh2.31 at the close. up to £130m to fund acquisitions but it still
More than 147m units changed hands, marks a rare success amid several cancelled
more than a quarter of the 550.73m shares capital-raisings by UK-listed funds.
SWITZERLAND placed in the IPO. The shares were offered at 100p each, a
On Thursday, the shares closed at Dh2.41. 5.2% discount to the close before launch and
MCH COMPLETES RIGHTS ISSUE Dubai Islamic Bank was lead manager and First a 14% discount to NAV of 116.2p per share
Abu Dhabi Bank was lead receiving bank. on August 22.
Marketing and events company MCH GROUP International Securities WASûlNANCIALûADVISERû $ESPITEûTHEûlNALûSIZEûAûBANKERûINVOLVEDû
has raised SFr76.9m (US$77.8m) through its BHM Capital Financial Services was listing adviser described the successful completion as “a
rights issue that was heavily backed by its and JP Morgan was capital markets adviser. little win”, adding: “It’s a big positive in the
major shareholders. current market given how many are being
The offer saw 87% take-up with 16.18m pulled.”
new shares subscribed at SFr4.75 each from UK On Monday The Sustainable Farmland
18.58m offered on a 5-for-4 basis, increasing Trust postponed its London IPO citing
MCH Group’s share capital to 31.05m SUSTAINABLE FARMLAND TRUST CONCERNSûOVERûVOLATILITYûSEEû%QUITIES
shares. PULLS IPO Despite typically being seen as more
The deal saw backing of SFr34m each STABLEû2%)4SûHAVEûALSOûSTRUGGLEDûINûRECENTû
from Lupa Systems and the Canton of Basel- SUSTAINABLE FARMLAND TRUST has postponed its WEEKSû,8Iû2%)4ûCANCELLEDûANûEQUITYûRAISEûTOû
Stadt. Lupa has increased its holding to London listing due to market volatility, with the fund acquisitions of stores from Sainsbury’s
38.5% from 32.3% and Basel-Stadt’s holding company to return subscriptions to investors. ANDû)NDEPENDENTû,IVINGû2%)4ûCANCELLEDûAû

EQUITIES AMERICAS
£150m London IPO, both pointing to market

instability.
4HEûVASTûMAJORITYûOFû(%)4SûSUPPORTûCAMEû
from existing investors wanting to support
Prime Medicine takes on
THEûlRMSûGROWTHûALBEITûCONSTRAINEDûBYû
DIFlCULTûTIMESû#HAIRMANû.ORMANû#RIGHTONû challenging IPO market
said market uncertainty had limited
commitments. US Gene editing specialist tests investor interest in biotech innovation
4HEûFUNDûHASûRIGHTûOFûlRSTûREFUSALûONûAû
pipeline of energy storage projects totalling Taking an understandably cautious approach in Prime boasts a strong pedigree in co-
more than 687.5MW under the control of tough market conditions, gene-editing specialist founder and major shareholder David Liu,
DEVELOPERû(ARMONYû%NERGY PRIME MEDICINE launched a US$160m Nasdaq a pioneer in CRISPR gene editing who also
Proceeds from the placing, plus 7m IPO on Thursday but only after extensively pre- co-founded both Editas Medicines and Beam
shares, will back the acquisition of 182MW marketing the deal to shore up demand. Therapeutics.
of projects. JP Morgan, Goldman Sachs, Morgan Stanley Liu, a consultant to Prime’s scientific
The new shares will begin trading as C and Jefferies are leading the sale of 8.9m board and a 24.8% shareholder, is being paid
shares on October 14 and convert to Prime shares at US$16–$18. The syndicate told US$150,000 annually as part of a consulting
ordinary shares within three months. accounts the offering was oversubscribed at agreement.
(%)4ûSHARESûCLOSEDûDOWNûûATûPûONû launch by insiders and reverse enquiry from Prime is advancing upon Editas’ CRISPR
Wednesday, still well above issue, and by previous testing-the-waters efforts. Cas9 and Beam’s base editing technologies,
Friday had risen slightly to trade at 111.4p Pricing is expected after the market closes which Liu helped pioneer, with a new technique
by 1.30pm in London. Wednesday, October 19. called prime editing.
Berenberg was bookrunner. The top of the marketing range values Prime Prime boasts significant financial backers
at US$1.75bn, a 1.3 times step-up from the despite being so early stage.
ACG SPAC SEES LIMITED TRADING valuation it fetched on a US$200m Series B T. Rowe Price, Casdin Capital and Cormorant
round in April 2021. The waiting period for an IPO Asset Management were among the new
Warrants in UK-listed SPAC ACG ACQUISITION has been a relatively lengthy one for crossover investors that participated in the Series B
began trading on Wednesday. investors who participated in that round. round, joining earlier-stage backers ARCH
The US$125m global metals and mining- Prime would represent the first US-listed IPO Venture Partners, Fidelity Investments (F-Prime
focused SPAC led by the former chief (US$50m-plus, ex-SPACs) since pre-clinical Capital) and Google Ventures.
EXECUTIVEûOFû%.û'ROUPû!RTEMû6OLYNETSûHADû inflammatory disease specialist Third Harmonic Prime had just US$92m of cash in the till
completed its IPO the previous week with Bio and AIG life-insurance affiliate Corebridge as of June 30. With the IPO proceeds, Prime
shares closing their debut on October 7 at Financial both debuted on September 15. expects to have enough to fund development
US$10.025. Only 15 companies raising more than US$50m through 2025.
Trading has been typically muted with have gone public this year, of which eight are biotechs. Robert Sherwood
some days when no shares changed hands.
Shares ended the week at US$9.925, while
warrants were quoted at US$0.505 but have Less clear is whether more companies DICE THERAPEUTICS KEEPS A TIGHT
yet to trade on exchange. stuck in the pipeline will join Prime on the CIRCLE OF SHAREHOLDERS
Citigroup was bookrunner of the IPO. road. Intel’s self-driving software unit
Mobileye Global can launch its IPO in the DICE THERAPEUTICS, an RA Capital-backed
COMINGûWEEKûAFTERûlLINGûPUBLICLYûLATEûLASTû BIOTECHûSECUREDû53MûFROMûITSûlRST TIMEû
month, though bankers said Intel was follow-on offering late on Wednesday that
simply keeping its options open and there followed positive trial results on its lead drug
AMERICAS was no certainty the deal would move and focused allocations on shareholders.
ahead this month. Bank of America, SVB Securities, Evercore and
Other companies that have hinted Guggenheim Securities placed 8.2m shares at
UNITED STATES at a near-term launch include renewable 53ûANûûlLE TO OFFERûDISCOUNTûAFTERû
ENERGYûDEVELOPERû-.û%NERGYûANDû one day of marketing. Demand was strong
US ECM STAYS SLOW FOR NOW DIGITALûMARKETINGûlRMû!LEPHûBUTû enough to increase the size of the offering
bankers expect most companies in from US$250m at launch.
53û%#-ûACTIVITYûLOOKSûLIKELYûTOûREMAINû the pipeline to wait until better markets Dice shares closed on Thursday at
depressed near-term as investors focus on next year. US$42.23, up 15.7% from the offer price.
third-quarter earnings and continue to look Stock issuance remained light in the About 85% of the new shares went to 10
for any hint that the Federal Reserve might past week as investors focused on institutions and the rest to 20 investors.
ease up on its hawkish agenda. Thursday’s hotter-than-expected US Another 50 institutions who put in for the
Syndicate desks were at least able to get CONSUMERûPRICEûINmATIONûDATAûWHICHû deal were not allocated, leaving them to buy
some IPO activity going in the past week; SHOWEDûCOREûINmATIONûHITTINGûAû YEARû in the market on Thursday.
early on Thursday launching the US$160m high of 6.6% for the month of September. Dice began the week at just US$24.65 and
Nasdaq IPO of gene-editing specialist Prime Syndicate desks still managed to raise ISûTHINLYûTRADEDû%VENûSOûTHEû53M PLUSû
Medicine for pricing post-close Tuesday. US$1bn from a small number of follow- post-deal rise indicates Dice could have
Assuming the deal is priced, Prime would ons, including a US$650m bought offering extracted a higher price by placing shares
RANKûASûTHEûlRSTû53M PLUSûNEWûISSUEû OFûSHARESûINû#AMECOûAû.93% LISTEDû with a broader set of investors.
since Corebridge Financial and Third Canadian uranium miner, and a US$300m RA Capital, which bankrolled Dice
Harmonic Bio debuted on September 15. follow-on from biotech Dice Therapeutics. through its IPO in September 2021 (at US$17

Dice is using the proceeds from the stock
NOG taps into dry CB market sale to help fund a Phase II trial it expects to
launch early next year.
for US$435m gusher BUSINESS FIRST RAISES A

QUICKFIRE US$50m
US Oil explorer funds M&A with HY alternative BUSINESS FIRST BANCSHARES, the parent of Baton
Rouge, Louisiana-based b1Bank, raised
NORTHERN OIL & GAS raised US$435m last week from a credit spread of L+500bp and a low-40s vol. US$50m late on Wednesday from an
the sale of 6.5-year convertible bonds, significantly That implies straight-debt equivalent pricing in overnight stock sale.
more than the US$350m sum it initially sought to the 8% range and compares with a 9% current Stephens led the sale of 2.5m Business First
fund a series of small acquisitions. yield on NOG’s shorter-dated 8.125% HY notes SHARESûORûABOUTûûOFûOUTSTANDINGûATûAûlXEDû
NOG has standalone appeal because of the maturing in March 2028. price of US$20.00, a 9% discount to
high cashflow it generates from high oil prices, Highly rated issuers have been reluctant Wednesday’s close.
something that shows no signs of moderating. to embrace CBs because of accounting In Thursday’s aftermarket, the shares
Even if oil prices were to falter, its hedged complexities. And there has been no need to do were trading at US$21.52, comfortably
production at US$75.00 over the next two years so in the low interest rate environment of the above the offering price.
provides CB investors with downside protection. past decade. The bank could use the proceeds to boost its
From a broader perspective, NOG benefited However, the financial crisis did see IG- capital, support organic growth, fund
from scarcity value. Issuers have raised just rated industrials such as Johnson Controls and acquisitions, and/or redeem subordinated debt.
US$16.2bn in the US CB market so far this year. Ingersoll Rand issue CBs in 2009, noted bankers. In early September, Business First also
At this time last year, CB issuance stood at Most companies are flush with cash so the raised US$72m from a self-managed private
US$63.5bn. need to fund is less acute than was the case in placement of preferred stock.
“I do think we will see a pick-up in issuance,” 2009, they said. Focused on commercial lending in
said one banker involved in the NOG CB issue. NOG’s shares gained 4.7% on Wednesday to Louisiana and Texas, Business First carries
“It’s not going to be an explosion, but I do think US$31.21, the CBs were wrapped at 105 by the US$5bn of assets.
converts offer a compelling alternative to straight close of trading, and its 8.125% HY notes shed 25 The bank has grown its lending book at a
debt. Companies are going to be looking for ways cents to 95.75. This was despite WTI oil easing 36% annualised rate so far this year and also
to reduce their funding costs. As interest rates 2.3% to US$87.27. purchased Texas Citizens Bank in March to
continue to rise, convertible bonds offer a way to “The CB opened up about 2.5-points on add US$534m of assets.
lower their funding costs.” a dollar-neutral basis and didn’t expand or Shares of Business First are down 24% this
NOG’s CBs were priced late on Tuesday at contract from there, tracking the stock price up year but have still more than doubled from
a coupon of 3.625% and conversion premium into the close,” said one CB trader. their lows at the start of the pandemic in
of 27.5%, the midpoint of 3.375%–3.875% and NOG generated second-quarter adjusted March 2020.
25%–30% price talk, after one day of marketing. Ebitda of US$272.5m on sales of US$549.6m,
A capped call funded with a portion of the despite realising a below-market US$58.55 per
proceeds offsets earnings dilution up to a 75% barrel after factoring in hedges. BRAZIL
premium, making the CB akin to high-yield. Cashflow is projected to grow to US$1.5bn in
Yet unlike the halcyon days of early 2021 when 2023 before moderating to US$1.45bn in 2024, THREE GORGES POWERS UP BRAZIL IPO
tech companies employed 50%–125% capped based on analyst consensus forecasts.
calls purely to communicate confidence their That provides a reasonable chance that CB China Three Gorges, China’s state-owned
equity valuations weren’t inflated, this is a real- holders will be able to convert at US$38.01, the RENEWABLEûENERGYûPROVIDERûEXPECTSûTOûlLEûLATERû
world application of the financing tool. conversion price, at some point. The upper strike this month to spin off its Brazilian operations
Joint bookrunners Citigroup, Wells Fargo and on the capped call is US$52.17. via a B3 IPO, according to a Reuters report.
RBC Capital Markets guided accounts toward Stephen Lacey Citigroup is leading a syndicate including Bank
of America, Itau, Banco Bradesco and BTG Pactual
for an estimated US$1bn IPO of CTG BRASIL.
per share) and owned a 13.6% stake ahead of The results suggest Dice’s drug is safer and CTG Brasil could go public in December,
the follow-on, has a reputation for more effective than approved treatments though, as for most IPO aspirants in the
controlling allocations in biotech follow-ons. from Amgen and Bristol Myers Squibb. queue, early 2023 is more likely.
/THERûRECENTûEXAMPLESûINCLUDEû%DGEWISEû “We believe the results demonstrate proof of It operates 17 hydropower plants and 11
Therapeutics, Wave Life Sciences and CONCEPTûANDûESTABLISHû;$ICESûDRUG=ûASûAûCONTENDERû wind farms with 8.3GW of installed capacity.
Concert Pharmaceuticals. FORûBESTûORALûTHERAPYû;FORûTREATINGûPSORIASIS=vû(#û Brazilian stocks have jumped 9% this year,
Dice reported Phase I trial results early on Wainwright analysts wrote in a research note. bolstered by a 4% gain since the beginning of
Tuesday that showed proof of concept for an oral HC Wainwright estimates potential sales /CTOBERûAFTERûTHEûlRSTûROUNDûOFûTHEûCOUNTRYSû
psoriasis drug with blockbuster potential, of Dice’s psoriasis drug at US$1.8bn in 2035 presidential election proved closer than expected.
sending its shares soaring 62.3% in open trading. with peak sales hitting US$4bn. A run-off vote will be held on October 30.
EQUITY-LINKED DEALS WEEK ENDING: 14/10/2022
Issuer Country Date Amount Greenshoe Tenor Coupon/YTM % Premium (%) Bookrunner(s)
Northern Oil & Gas US 11/10/2022 US$435.0m US$65.0m 6.5y 3.63 27.50 Citigroup, Wells Fargo, RBC CM

The 2022 IFR Asia China Onshore/
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WEDNESDAY OCTOBER 26, 2022 | 3PM SGT/HKT

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reduce their funding costs in the bond market?
• How are onshore ratings evolving with the introduction of foreign rating agencies to the market?
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owen.wild@lseg.com SENIOR REPORTERS: LONDON NEWS EDITORS TOKYO
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INTERNATIONAL FINANCING REVIEW INDEX
Abrdn Private Equity Opportunities Trust 55 Cronimet 52 IDT Biologika 52 Prime Medicine 67
ACG Acquisition 67 CTG Brasil 68 Immatics 64 Pronovias 3
Advance Logistics Investment 61 Daimler Truck 37 IndiaFirst Life Insurance 61 Queen Tak Development 49
Aeon Investments 35 Dice Therapeutics 67 International Container Rakuten Bank 62
AFD 21 Didi Global 8 Terminal Services 42 Reliance Industries 48
Africa Finance Corp 54 DriveTime Automotive 9 JEIO 62 Reliance Jio Infocomm 48
Agence Francaise de Developpement 21 Eaton 52 Johnson Controls International 49 RXO 30
Airservices Australia 22 Electronics Mart India 61 JP Morgan 11 Sappi 45
Alphawave IP 54 Enel 53 Kanzhun 8 SBI Sumishin Net Bank 62
Anglian Water 5 Enerflex 7 Keter 3 Securitas 66
Apex Circuit (Thailand) 51 Engie 24 Kokusai Electric 62 Shawbrook Group 28
Apex International 49, 50 EnQuest 5, 6 Kosan 17 SICC 60
Arabian Drilling 65 ESR Group 48 Kroger 55 Sinopec Marketing 60
Argenta Spaarbank 29 European Stability Mechanism 22 La Banque Postale 27 Slovakia 44
Atlantia 53 European Union 6 Landesbank Berlin 29 Societe Generale 30
Axpo 54 Exeter Finance 9 LATAM Airlines 7, 46, 56 Socionext 62
Banca Monte dei Paschi di Siena 64 FabIndia 61 Lazard 15 Southern Auto Finance 9
Barclays 7 Federal Realty Investment Trust 55 LBBW 26 Stada Arzneimittel 31
Baring Private Equity Asia 57 Fedrigoni 31, 32 Lionheart Studio 61 Suncorp-Metway 30
Bauer 64 Ferguson 55 Lundbeck 51 Sustainable Farmland Trust 66
BayernLB 29 Fibabanka 45 LX Technology 60 Switzerland 20
Benetton 53 Finance Ireland 5, 32 Marafiq 65 Syngenta Group 42
Betagro 63 Flora Food Group 3 Masan 50 Taskforce on Nature-Related
Bionote 62 Flowing Cloud Technology 60 MCH Group 66 Financial Disclosures 18
Blackstone 53 FLSmidth 51 Mercedes-Benz 52 Tata Capital Financial Services 49
Bluewater Holding 31 Fluro Platform 34 Military Commercial Techcom Securities 50, 51
BNP Paribas 34 FMO 22 Joint Stock Bank 50, 51 Tegna 31
Brightspeed 47 Fortune Real Estate Investment Trust 48 Mitsubishi Estate Logistics Tendam 54
Brookfield Renewable Partners 8 FrieslandCampina 53 REIT Investment 61 Tenneco 31
Burjeel Holdings 66 Full Truck Alliance 8 Mitsubishi Heavy Industries 17 Terna 53
Business First Bancshares 68 General Electric 23 Mobile World Investment 50 Thai Credit Retail Bank 63
CA Consumer Finance 5, 34 Georgia Capital 44 Morgan Stanley 11 Thermo Fisher Scientific 25
Cadeler 64 Germany 6 Naturgy 24 Toronto-Dominion Bank 12
Caffil 27 Giant Biogene 60 NIB 60 Treasury Corporation of Victoria 22
Caisse des Depots et Consignations 21 GIB Asset Management 18 Nidda Healthcare Holding 32 UCI Portugal 33
Cameco 8 GLP J-REIT 61 Nielsen 31 United Group 3
Casino 3 Golfzon Commerce 61 Nigeria 44 United Kingdom 19
CDC 21 Goodpack 58 Northern Oil & Gas 68 Valmet Automotive 63
Cemex 56 Goodyear Tire & Rubber 51 Odeon Cinemas 5, 6, 31 Vattenfall 25
Chad 43 Greenko Group 41 Odeon Finco 5, 7 Vericast 56
China Water Affairs Group 48 Harmony Energy Income Trust 66 Olin 55 Verisure 3
CIFI Holdings 48, 59 Harum Energy 49 OP Corporate Bank 28, 30 Vinfast Trading and Production 50
Cineworld 13 HGS Healthcare 57 Oschadbank 45 Volkswagen Leasing 5, 34
Citco 56 Hidroelectrica 65 Oxfam 16 Yeong Guan Energy Technology Group 49
Citigroup 11 Holland & Barrett 56 PCGI Holdings 48 Zambia 43
Citrix Systems 47 House of HR 57 Pepper Finance 33 ZF Friedrichshafen 52
Commonwealth Bank of Australia 29, 30 Hypo Vorarlberg 29 Playtech 54
Cowen 12 Idemitsu 17 Porsche 63

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OCTOBER 15 2022 ISSUE 2455 www.ifre.

Investors call for Bank of England to

Bankers fret over leveraged ﬁnance maturity

Head to head: European Union outshines

BONDS STRUCTURED FINANCE EQUITIES PEOPLE & MARKETS

Full-day passes are just $495, and cocktails-only passes

Visit our website for more information and to register:

Dear oh dear Out of options

U sually if the US sneezes, the rest of the world catches a

International Financing Review October 15 2022 1

Investors call for BoE U-turn on Gilt sales

2 International Financing Review October 15 2022

time,” said Shearing. “It has a

International Financing Review October 15 2022 3

European ABS still standing

4 International Financing Review October 15 2022

International Financing Review October 15 2022 5

SAWûlNALûBOOKSûPASSûõBNû&ORû The European Commission, “We had almost the same

UK high-yield issuers seek refuge in dollars

6 International Financing Review October 15 2022

or 2bp of premium would have

International Financing Review October 15 2022 7

Brookﬁeld and Cameco go nuclear

growth of nuclear power offering was well subscribed,

8 International Financing Review October 15 2022

companies that have sought

International Financing Review October 15 2022 9

Banks work out how to work out

Reach the people who matter

10 International Financing Review October 15 2022

 FRONT STORY RESULTS

JP Morgan leads rivals with resilient FICC

International Financing Review October 15 2022 11

Cowen big six set for US$223m payday from TD deal

Who’s moving where…

12 International Financing Review October 15 2022

Please contact us if you have information about job moves: people.markets@lseg.com

International Financing Review October 15 2022 13

Who’s moving where…

14 International Financing Review October 15 2022

CS calls for ‘more sophisticated’ ESG analysis

Please contact us if you have information about job moves: people.markets@lseg.com

International Financing Review October 15 2022 15

FSB wants crypto regulation amid

Oxfam, World Bank face off over climate ﬁnance

16 International Financing Review October 15 2022

ESG to drive ‘systemic change’ TAXûPOLICYûASûPARTûOFûRESPONDINGûTOûTHEû

International Financing Review October 15 2022 17

GIB AM launches sustainable corporate bond fund

Nature-related risk framework comes under ﬁre

Highlight your success with reprints from IFR

18 International Financing Review October 15 2022

£560bn of linkers cast shadow

International Financing Review October 15 2022 19

20 International Financing Review October 15 2022

priced the trade at that very level, having õM ûTHEûSMALLESTûBOOKûFORûAû#$#ûEUROûISSUEû

EUROPEAN SOVEREIGN BOND AUCTION RESULTS WEEK ENDING OCTOBER 14 2022

International Financing Review October 15 2022 21

ALL INTERNATIONAL US$ BONDS ALL SOVEREIGN BONDS IN EUROS

SAWûlNALûBOOKSûPASSûõBNû&ORû The European Commission, “We had almost the same

FRONT STORY RESULTS

priced the trade at that very level, having õMûTHEûSMALLESTûBOOKûFORûAû#$#ûEUROûISSUEû

h.)0SûAREûDElNITELYûHIGHERûBUTûTHEûWAYûTOû 10 ANZ 1 14,850.00 1.9 10 Natixis 5 28,600.00 1.7

lVEûYEARSûTOûPRIMEûANDûNEAR PRIMEû Fluro’s eight-year history and strong ,ATHAMûû#OûANDû3-%ûlNANCEû

FRONT STORY ASIA

FRONT STORY US LEVERAGED MARKET

Proportional credit SUSTAINABILITY LINKEDûLOANûOFûUPûTOû(+BNû AREûINûTALKSûWITHûRELATIONSHIPûBANKSûFORû

Taiwan Inc sweetens Aû53MûlVE YEARûLOANûFORûRUPEEû

BPûANDûBPûFORû!n!ûITûISûBPûANDûBPû 4HEûlNANCINGûISûBEINGûPROVIDEDûBYûVARIOUSû INTEGRATESûSUSTAINABILITYûINTOûTHEûGROUPSû