Hong Kong railway giant MTR Corp., with over HKD99.4 billion (USD12.8 billion) in assets, is considering entering an interest rate swap on the back of a USD600 million bond offering it closed late last week. "We're assessing the situation right now," said Jeff Kwan, deputy treasurer.
He said a plain-vanilla swap is more likely than a cross-currency interest rate swap, which would convert the proceeds into Hong Kong dollars, because its overall unhedged U.S. dollar exposure is only around 5%. "Our U.S. dollar exposure is quite manageable," noted Kwan. He continued that MTR will likely make a decision in the next few weeks, but declined to reveal on the factors that will form its decision.
HSBC, Goldman Sachs and UBS were the arrangers of the recent bond. Kwan declined to name potential swap counterparties.
