The spread of Asian high-grade bonds reached a five-year low; large financial institutions issued AT1 bonds during Asian hours.
As of Friday (11/17), there were only four deals in the Asian (ex-Japan) bond market this week, raising about $1.01 billion, a sharp drop from $4.85 billion the previous week. The credit spread of Asian investment-grade bonds narrowed by about 4bps this week, and accumulated about 13bps since November, bringing the credit spread to the lowest level since 2018.
Meanwhile, as the market expects the Fed to end the rate hike cycle soon, boosting the risk sentiment of the emerging Asian bond market, two multinational financial institutions issued AT1 new bonds during Asian hours this week, of which Barclays’ AT1 new bond attracted investors to subscribe for about $22 billion (12.5 times the issue size), with a final issue size of $1.75 billion, and the issue yield was about 88bps lower than the initial pricing guidance, indicating that after UBS Group successfully issued $3.5 billion of AT1 new bonds last week, the bond market’s risk appetite remains good.
Primary market new issues
Barclays Plc issued a US dollar-denominated junior subordinated AT1 bond of $1.75 billion on Wednesday (11/15).
• Issuer Rating:Moody’s Baa1 / S&P BBB+ / Fitch A
• Bond Rating:Moody’s Ba1 / S&P BB- / Fitch BBB-
• Loss absorption:Mandatorily converted into common equity if determined by the regulator or if the Tier 1 capital ratio falls below 7%
• Initial Price Guidance:10.5% area
• Issue Yield and Spread:9.625%
Banco Santander S.A. issued two US dollar-denominated junior subordinated AT1 bonds of $2.5 billion on Thursday (11/16).
• Issuer Rating:Moody’s A2 / S&P A+ / Fitch A-
• Bond Rating:Moody’s Ba1
• Loss absorption:Mandatorily converted into common equity if determined by the regulator or if the Tier 1 capital ratio falls below 5.125%
• Initial Price Guidance:PerpNC5 and PerpNC9.5 both at around 10.125% area
• Issue Yield and Spread:9.625%
Secondary market trading
• Barclays (BACR) 9.625% PerPNC6 bond is currently traded at around 9.65%, and the yield has increased by about 2bps since the issuance.
• Banco Santander (SANTAN) 9.625% PerpNC5 bond is currently traded at around 9.63%, and the yield is roughly the same since the issuance.
• Banco Santander (SANTAN) 9.625% PerpNC9.5 bond is currently traded at around 9.50%, and the yield has decreased by about 13bps since the issuance.
亞洲高評級債券的利差來到近五年低點;大型金融機構於亞洲時間發行AT1債券
截至週五(11/17),本週亞洲(除日本外)債券市場僅有4筆交易募資約1.01億美元,較前一週的48.5億美元大幅回落。隨著新券發行量下降,亞洲投資級債券的信用利差在本週收窄了約4bps,11月至今累計收窄了約13bps,使信用利差來到2018年以來的低點。
於此同時,由於市場預期聯準會即將結束升息週期,利好新興亞洲債券市場的風險情緒,本週有兩家跨國金融機構於亞洲時間發行AT1新券,其中巴克萊集團的AT1新券吸引投資人認購規模達220億美元(約當發行量的12.5倍),最終發行量為17.5億美元,且發行利率較初始定價指引低了約88bps,顯示繼上週瑞銀集團成功發行35億美元的AT1新券之後,債券市場的風險胃納仍佳。
本週初級市場新券發行
巴克萊集團於週三(11/15)發行一筆美元計價AT1債券共17.5億美元
• 發行人信評:Moody’s Baa1 / S&P BBB+ / Fitch A
• 債券信評:Moody’s Ba1 / S&P BB- / Fitch BBB-
• 吸收損失機制:經主管機關認定或一級資本比率低於7%,將強制轉換為普通股股本
• 初始定價指引:10.5%附近
• 最終定價:定價在9.625%
西班牙國際銀行於週四(11/16)發行兩筆美元計價AT1債券共25億美元
• 發行人信評:Moody’s A2 / S&P A+ / Fitch A-
• 債券信評:Moody’s Ba1
• 吸收損失機制:經主管機關認定或一級資本比率低於5.125%,將強制轉換為普通股股本
• 初始定價指引:PerpNC5與PerpNC9.5皆在約10.125%附近
• 最終定價:PerpNC5、PerpNC9.5皆定價在9.625%
次級市場交易
• 巴克萊集團(BACR)9.625% PerpNC6 AT1目前收益率約9.65%,利率較發行時走高約2bps
• 西班牙國際銀行(SANTAN)9.625% PerpNC5 AT1目前收益率約9.63%,利率與發行時大致持平
• 西班牙國際銀行(SANTAN)9.625% PerpNC9.5 AT1目前收益率約9.50%,利率較發行時走低約13bps