Saudi Arabia ain’t got nothing on me
I’ve always considered myself a gent of superior taste and class. While I’m not averse to hanging out with the hoi polloi, I think it is no exaggeration to say that I’m considered one of Hong Kong’s respected elder statesmen.
TaiTai has a tendency to roll her eyes at me when I talk in this vein but it turns out that I’m having the last laugh as I have just discovered I can command better funding rates than a sovereign.
My attention was caught this week by the news that Saudi Arabia raised $17.5bn from its first international bond. The headline figure looked good but as old habits die hard I decided to dust off the Bloomberg and check out where the bond priced.
It turns out the country only had to pay 135bp over US Treasuries (about 2.6% for those of you that don’t speak fixed income). Not bad for a split AA/A rated sovereign with a dubious human rights record and a shrinking GDP, I thought to myself.
That was until the latest tax loan offer from my high street bank popped through the letter box. It seems they will give me five year money at a rate of about 2%, with no FX risk as the Hong Kong dollar is pegged to the US dollar. By my reckoning that makes me a strong triple A rated credit.
Talk about the unintended consequences of quantitative easing.
Of course, being the generous soul that I am, I’m not one to keep my good fortune to myself. So if there are any cash strapped emerging market countries wanting a good deal on funding, I’m your man.