Only the best will survive
Which are Asia's most sophisticated borrowers? This is the question Euromoney put to 16 heads of debt syndication in Hong Kong, Singapore and Tokyo. As spreads widen and credit ratings fall, these are lean times for Asian borrowers. Only the best - those who have spent the past few years developing an innovative approach and building up a good name - will be able to get their bonds away. By Nicholas Bradbury.
After a slow year for Asian Eurobonds, new issuance all but dried up following the Hong Kong stock-market crash in late October. With spreads for Asian benchmark issues widening dramatically, it was clear that confidence in Asian debt had suffered a dramatic decline. Only the most desperate, the most creditworthy or the best-known borrowers are likely to risk a return to the market in 1998.
The slow recovery of the Asian Eurobond market will be led by a small group of the region's most creditworthy borrowers: sovereigns, quasi-sovereigns and the very best of the region's corporates. Although most Asian companies will be able to issue only on highly unfavourable terms, a select few - those with export markets outside the region and solid management skills - may be able to draw on their past performance to make a successful early return to the market.