Financials Credit Analyst

Hank Calenti, CFA

Credit

Spread tightening at the beginning of the week caught market concerns regarding the coronavirus outbreak. Profit taking before the Lunar New Year also likely contributed to spread reversal. As the week began, yields on double-B rated US$-bonds fell to their lowest levels ever while high yield bonds over-all hovered just above all-time lows of 4.83%.  By the end of the week, Asian bank Subordinated US$-bond spreads were wider while Asian bank Senior Unsecured US$-bonds were largely unchanged. Each High Yield Asian bank Subordinated bond that we track widened, possibly on coronavirus concerns. We expect the economic fallout from attempts to contain the virus to pressure Asian bank subordinated debt bonds over the near term.In Asia’s new issue market, Indonesian real estate developer, <a href="https://www.smartkarma.com/entities/bumi-serpong-damai-pt" target="_blank" rel="noopener" data-smartkarma-citation="entities:15498:1">Bumi Serpong Damai (BSDE IJ)</a> brought a five non-call three-year “Ba3” rated US$-bond to the market with a 5.95% coupon. At the same time, demand for deeply subordinated new issue bonds remained high and the Republic of the Philippines brought a nine-year Euro-bond to the market with a negative concession. Pricing of the Philippine government bonds may bode well for similar maturity Philippine bank bonds and could open a wider market for longer dated Philippine bank paper.  We highlight debt capital new issue that may have potential implications for Asian bank debt in this weekly report.

Spread tightening at the beginning of the week caught market concerns regarding the coronavirus outbreak. Profit taking before the Lunar New Year also likely contributed to spread reversal. As the week began, yields on double-B rated US$-bonds fell to their lowest levels ever while high yield bonds over-all hovered just above all-time lows of 4.83%.  By the end of the week, Asian bank Subordinated US$-bond spreads were wider while Asian bank Senior Unsecured US$-bonds were largely unchanged. Each High Yield Asian bank Subordinated bond that we track widened, possibly on coronavirus concerns. We expect the economic fallout from attempts to contain the virus to pressure Asian bank subordinated debt bonds over the near term.In Asia’s new issue market, Indonesian real estate developer, Bumi Serpong Damai (BSDE IJ) brought a five non-call three-year “Ba3” rated US$-bond to the market with a 5.95% coupon. At the same time, demand for deeply subordinated new issue bonds remained high and the Republic of the Philippines brought a nine-year Euro-bond to the market with a negative concession. Pricing of the Philippine government bonds may bode well for similar maturity Philippine bank bonds and could open a wider market for longer dated Philippine bank paper.  We highlight debt capital new issue that may have potential implications for Asian bank debt in this weekly report.

Asian Bank HY Credit Weekly: Coronavirus Offsets Positive Issuance News in Asian Credit Spreads

Denmark

Jyske Bank A/S is a Danish banking group that includes mortgage lender Jyske Realkredit and other subsidiaries. The Group offers financial services including banking, insurance, mortgage, asset management, brokerage, and leasing services. Jyske Bank operates throughout Denmark and serves private individuals, corporations, and the public sector.

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Jyske Bank A/S (JYSK DC)

Asian Bank HY Credit Weekly: Coronavirus Offsets Positive Issuance News in Asian Credit Spreads

Spread tightening at the beginning of the week caught market concerns regarding the coronavirus outbreak. Profit taking before the Lunar New Year...

Hank Calenti, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)