In an intensely competitive landscape, Taipei Fubon Bank outclassed its peers with its structuring capabilities, playing a proactive role in leveraged buyouts and seizing opportunities beyond the slowing China market.
Taiwan was the sole bright spot in a shrinking Asian loan market in 2015, as easier funding conditions for the island’s lenders helped buck a regional decline in deal volumes.
However, exposure to China’s private sector was still a sticking point, as country limits and growing fears of corporate defaults underlined the importance of working with the right credits.
Taipei Fubon picked its spots carefully, winning sole mandates from a couple of Chinese state-owned enterprises and syndicating them successfully. Syndication of a debut US$150m three-year loan for CIMC Enric Holdings closed within a month with a dozen other banks from China and Taiwan joining, underlining Taipei Fubon’s ability to satisfy demand for yield among Taiwanese lenders amid tightening credit exposure to the PRC.
“Despite the tighter AI822 (PRC exposure) limit, compared with our Taiwanese peers, Fubon managed to lead and close a number of PRC deals,” said Stephen Chan, senior executive vice president and head of corporate finance department at Taipei Fubon.
The bank also won a sole mandate and a repeat one on Guangzhou government-owned real-estate developer Yuexiu Property, completing an increased US$106m three-year loan in July. In the face of headwinds in China’s real-estate sector, Taipei Fubon successfully brought seven others lenders into the facility. The same month, Taipei Fubon was also one of nine bookrunners on a US$761.2m three-year loan for Chinese department store chain Golden Eagle International Trading. The loan was almost doubled from an initial US$400m target after attracting 15 other banks.
In the domestic market, Taipei Fubon was one of the leads on the jumbo NT$32bn (US$976m) seven-year loan for cable television operator Taiwan Broadband Communications, another repeat borrower, in June. The bank bagged the role of a facility agent on the loan, which went down well with yield-hungry lenders.
Taipei Fubon used its relationships with top-tier local borrowers to win business further afield, such as the US$1.5bn five-year loan for conglomerate Formosa Plastics Group’s steel mill project in Vietnam. This was the largest US dollar loan in Vietnam during IFR’s review period.
The bank continued to build strong relationships in South-East Asia, matching top local companies with asset-hungry Taiwanese lenders.
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