December 20, 2017 / 7:54 AM / 10 months ago

ASIA CREDIT CLOSE: Credit stable after US Senate approves tax reform

SINGAPORE, Dec 20 (IFR) - Asian credit stayed strong on thin year-end volumes, with no sharp moves after the US Senate approved the Republican tax reform bill, moving it a step closer to passing into law.

The Asia ex-Japan iTraxx investment-grade CDS index was 2bp tighter at 67.5bp/68.5bp, but generally the development seemed to have been priced into Asian credit, as could be seen from the lack of movement in Alibaba’s recently issued bonds, which are among the most liquid.

The Chinese technology company’s latest issue was unchanged across maturities from 2023 to 2057, apart from a 1bp widening of its 2027 notes, which were quoted at Treasuries plus 103bp.

In high yield, HNA Group’s 6.25% 2021s dropped half a point to a cash price of 85.25, while Noble Group’s 2022 bonds were bid at a cash price of 37.65, as the commodities trader readied restructuring plans.

CIFI Holdings Group’s perpetual bonds have recovered a quarter of a point since the end of last week and were bid at a cash price of 98, still two points below pricing on December 12.

Bumi Resources’ US$488m Series A 2022 bonds were bid at a cash price of 104.25, according to Tradeweb, having been issued on December 11 following a restructuring of the Indonesian mining company’s old debt.

Moody’s rates the senior secured notes B3, having upgraded Bumi’s corporate rating to B3 from Ca following the completion of the restructuring. The coupon is paid partly in cash and partly in principal, depending on prevailing coal prices.

S&P raised Bumi’s rating to CCC+ from D on completion of the debt exchange.

Reporting by Daniel Stanton; Editing by Vincent Baby

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