Virus Makes Asia’s Bond Bankers Recalibrate as Sales Slow
Virus Makes Asia’s Bond Bankers Recalibrate as Sales Slow
(Bloomberg) -- As the coronavirus spreads from China, Asian bond deals have slowed from record levels, forcing bankers to spend more time at home rather than slog in the office past midnight to arrange sales.
After a record $41 billion of Asia dollar notes were sold in the first few weeks of January, sales slumped to zero last week amid the Lunar New Year holidays and rising fears of the virus.
Deal flow has picked up in the past few days with investors focusing on investment-grade companies, but it’s still far from the peak earlier this year. Much of the bond sales has been from non-Chinese borrowers, including those from South Korea and India. Any sustained slump would be a concern for banks already grappling with slowing Hong Kong initial public offerings and mainland acquisitions.
A Hong Kong-based debt capital market specialist at a global investment bank said he is working from home, and just going to the office from time to time. With more time outside work, he’s been monitoring the news on the epidemic, spending time with family and catching up with friends for coffee.
With the illness spreading to Hong Kong and Singapore, borrowers, bankers and investors are forced to adapt. Instead of meetings, many are opting for conference calls. Among the borrowers to take that route this week are CSSC (Hong Kong) Shipping Co. and Beijing Properties (Holdings) Ltd. A senior debt banker at at regional bank said that he had a couple of China bond deals that were due to launch this week, but they are re-thinking the timing.
Pheona Tsang, chief investment officer of fixed income at BEA Union Investment Management in Hong Kong, said that the calls have been working well for borrowers that have been in the market for a long time and just need to provide updates to investors.
“We try to minimize the contact, but we can do conference calls and video conferencing,” said Tsang, who is working from the office while some of her colleagues conduct business from home.
To contact the reporter on this story: Denise Wee in Hong Kong at dwee10@bloomberg.net
To contact the editors responsible for this story: Andrew Monahan at amonahan@bloomberg.net, Ken McCallum
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