By Ioannis Gougoulias
The data below were retrieved using CMDPortal's Data Sheet and Instrument Search tool.
China still drives the Developing Markets, despite the 13% YoY drop in issuance
During the first weeks of 2018, China still remains the main contributor of the Developing markets issuance. Chinese borrowers issued USD9.9bn in international markets from 1/1/2018 to 9/3/2018, USD1.5bn or 13.16% less than what they did at the same period in 2017. The issuance came in three currencies, USD, HKD and CNY. The US dollar remains again the most preferred currency but what surprises is the total absence of EUR issuance, which in the beginning of 2017 was close to USD3bn. Despite the low cost environment in the Euro area, Chinese borrowers did not took advantage of the opportunities and moved from EUR to HKD issuance, which amounted to USD2.3bn. Splitting the issuers by industry sector, it is noticed that Chinese property developers have had an outstanding issuance activity in the first 10 weeks of 2018. Specifically, they increased their issuance by almost 250%, reaching USD6.9bn from USD1.9bn. This increased activity can be explained by the fact that a looming amount bonds reach their maturity in 2018 and Real Estate agents want to refinance them with new and cheaper bonds. In total, the issuance moved away from Bank and Government sector to the Corporate one, which now comprises 80% of the total amount. On the other hand, Commercial Banks and state owned Development Banks issuance, which comprised 67% of the total issuance in the first weeks of 2017 has fallen dramatically.
The following excerpt is included in CMDPortal's 2018 Winners in Debt Capital Markets hard copy publication. To access the full PDF version follow this link 2018 CMD Awards.
China continues to drive overall growth in Developing Capital Markets: Chinese borrowers, including those that belong to Chinese groups, issued USD176bn or 38% more in 2017 than they did in 2016 in the international market. This percentage of growth is not much different if we include domestic markets, even though the total sum of issuance jumps to USD455bn more than in the previous year. Chinese bond issuance in this universe comes in USD, CNY, and HKD and 11 other currencies. After USD issuance, CNY makes up the biggest chunk. Issuance in HKD is the 3rd largest followed by EUR and GBP. By type of borrowers, one third is from FIGs and about two thirds from SSAs. Corporates whilst demonstrating a massive growth rate of over 80% overall, only make up 5% of the market. In international bonds this increases to 11% for corporates and 78% for banks. Chinese property developers in particular made good use of the offshore market. This universe included Kaisa Group and China Evergrande who together took over USD12bn out of a total of USD27.7bn for these issuers in 2017. In total 32 Chinese property developers were active out of a total of 80 Chinese Corporate borrowers.
Where is this data coming from?
CMDportal is the global bond and money market data utility connecting issuers, dealers and investors. The service aggregates data from a wide range of sources, including issuers, dealers and fund investors recording both who issued, who traded and who bought the instruments.
Can I produce a Debt Capital Market statistical query like this?
Yes you can. CMDportal provides a wide range of tools to analyse bond and money markets. Data Sheet results can be downloaded as an XLS file.
Mr Ioannis Gougoulias is an Analyst at CMDPortal. He can be reached at email@example.com