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DESPITE a worsening political situation in Indonesia, investors flocked to both Asia Pulp and Paper's $351m ADR sale and a $60m sale of the government's stake in Indofood Sukses Makmur this week. Bankers cited the deals as proof that good companies can do deals even in the most difficult circumstances.

THE AUSTRALIAN domestic corporate bond market finally came of age this week with the launch of the first true public issue from an industrial triple-B credit. The A$150m transaction from local media group John Fairfax Holdings -- which was overwhelmingly successful and increased -- was hailed by market participants as a watershed in the market's development as it moves beyond the bank and high grade market towards a full credit spectrum of issuers.

THE ASIAN Development Bank's $1.25bn global bond secured a strong response for the ADB's first major benchmark of the year late last week. Led by Goldman Sachs and Morgan Stanley Dean Witter, the five year deal was increased from its original $1bn issue size after particularly heavy buying from Asian investors fed through into Europe and later the US.

CONFIDENCE appeared to have returned to the Singapore economy this week, with strong demand reported for the $130m IPO for Allgreen Properties. Two share placements were also completed, while a slew of small domestic IPOs reinforced the feeling that confidence is steadily returning to the region. Bankers said the Allgreen IPO, led by DBS and Morgan Stanley Dean Witter, is already four times oversubscribed and was likely to be a great success.

A STRONGER than expected secondary market performance by Asia's first two euro denominated offerings from Hong Kong conglomerate Hutchison Whampoa and the Republic of the Philippines has prompted the region's benchmark borrowers to consider the new market. Bankers said that although Korea Electric Power Corporation's (Kepco) prospective Eu300m to Eu500m debut has been pushed back to early June, it may swiftly be followed by deals from the People's Republic of China and the MTRC, as well as a potential offering from the Electricity Generating Authority of Thailand.

AYALA CORP has appointed Lehman Brothers as bookrunner and ING Barings as joint lead manager for its forthcoming sale of $300m of a new class of shares to international investors. The sale of the stock, labelled 'X shares', has already been passed by Ayala's board and is expected to be approved by shareholders today (Friday).

JP MORGAN is readying a second transaction from its new Sequils-Mincs structure, a state of the art form of cashflow arbitrage CLO. The bank declined to comment, but is believed to have inaugurated the structure earlier this month with an issue of $826.46m of bonds in two tranches, conveying exposure to a $712.46m portfolio of leveraged loans.

FOLLOWING the German state of Saxony-Anhalt last year, and Schleswig-Holstein earlier this year, Land Hessen has mandated Deutsche Bank to arrange a Eu5bn Euro-MTN programme, to be signed in September or October. "In former years the German public sector mostly tapped the domestic market," said Hans-Joachim Soll, head of funding at the state treasury.

Egypt The general syndication for the $220m international tranche of the senior secured facility for the Egyptian Company for Mobile Services (ECMS) was launched this week by international arrangers Chase Manhattan, Dresdner Kleinwort Benson, Paribas and WestLB.

* ABN Amro has arranged a Eu750m Euro-MTN programme for Interbanca. The programme, which is currently unrated, was signed on April 19. Interbanca is a commercial bank based in Milan, which is 99.5% owned by Banca Antoniana Popolare Veneta. Italian banks are increasing their Euromarket borrowing activity as the retail market has dried up. Public issuance in the first quarter of 1999, at Eu4bn, has already exceeded last year's total, according to ABN Amro.

THE GERMAN Neuer Markt has shrugged off last week's losses triggered by the worldwide sell-off in technology stocks, with new issue activity reviving this week. Last week the Nasdaq fell by around 7% as international and US investors became increasingly concerned with the earnings outlook for the technology sector.