Asia Pacific

Road King Infrastructure’s recent Rmb1.3bn ($197.9m) bond will make it easier for other double-B rated borrowers to tap the Hong Kong renminbi market, said a senior debt banker.

Hong Kong is planning to sell up to HK$10bn ($1.28bn) in inflation-linked bonds in a bid to reduce the effects of growing inflation.

Chinese solar power company LDK Solar sparked debate this week when its recent Rmb1.2bn ($182.4m) synthetic renminbi deal plummeted in the secondary market. Some bankers said the poor performance of the deal would dent investor confidence in the embryonic market.

Road King Infrastructure’s recent Rmb1.3bn ($197.9m) bond will make it easier for other double-B rated borrowers to tap the Hong Kong renminbi market, said a senior debt banker. The property and toll road company generated around Rmb2.22bn of orders last week, overcoming fears about heavy supply from the property sector.

JP Morgan’s self-led Samurai issue, which marks the return of US bank issuers to the Japanese market, was priced at the tight end of initial guidance and reached a size of ¥111.1bn, across five year fixed and floating tranches. Rabobank has been the only financial institution in the past year to print tighter in Samurai.

Svenska Handelsbanken became the first continental European issuer to sell Hong Kong renminbi bonds this week, raising Rmb170m ($25.79m) from a deal that it will not attempt to remit to mainland China.

Hong Kong’s renminbi bond market is developing at a breakneck pace but volumes are being held back by the lack of a liquid currency swap market. However, analysts predict that will change in 2011 — encouraging a greater variety of issuers to tap the market.

Zhong An Real Estate postponed its synthetic renminbi deal this week, due to fears over recent supply and government measures to cool China’s property market. The company will talk to key investors after Chinese New Year and then decide whether to make a second attempt.