Business for bankers in Southeast Asia is booming: Debt issuance at a record, mergers and acquisitions are on track for the second-busiest year, and some major initial public offerings are lined up in Singapore.
That is quite a contrast with activity in Hong Kong and China, where bankers and investors have focused their attention in recent years but where new listings in particular have gone relatively dormant and few large IPOs are on the horizon.
Southeast Asian companies are eagerly tapping the bond markets to capture low interest rates, while offerings from governments are drawing greater interest as the credit ratings on some of the region’s biggest countries improve. A record $41.3 billion has been raised by the region’s borrowers so far this year, according to Dealogic, handily besting the old record through mid-April of $24.5 billion.
Indonesia and the Philippines have both sold bonds at record low yields this year. Foreign interest has been especially keen in Indonesia, which was recently upgraded to investment-grade status. On Wednesday, it priced a $2 billion bond that yielded 3.85 percent, far lower than forecast, while demand exceeded $5.9 billion. -By Isabella Steger