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Thursday, 23 May 2019

Taiwan Loan House

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In an intensely competitive landscape, CTBC Bank outperformed its peers again in 2018 with superior structuring capabilities, playing a proactive role in leveraged buyouts and seizing opportunities to bring international borrowers to Taiwan.

Leveraging on its international network and its structuring abilities, CTBC enhanced its presence in regional loan syndications with agent roles on 22 syndications at home and abroad during IFR’s review period.

“Despite the adverse market conditions this year, CTBC maintained its strong commitment to the home market via lead-arranging a few key jumbo transactions, including sole mandates for local LBOs,” said Matthew Liaw, head of global structured finance at CTBC Bank.

CTBC won a coveted sole mandate as underwriter of the NT$7bn (US$226m) five-year loan to back local investment firm Mao Te International Investment’s buyout of Eastern Broadcasting, the largest cable TV network in Taiwan, finally completing an exit for private equity firm Carlyle Group.

As one of two lead arrangers, CTBC showcased its leveraged finance capabilities with the structuring and underwriting of a US$255m five-year loan backing Affinity Equity Partners’ purchase of a majority stake in garment label maker Trimco International Holdings.

CTBC also stepped up on a NT$31.2bn five-year loan to back KKR’s leveraged buyout of LCY Chemical and a US$330m five-year loan to back Advent International’s LBO of a mattress maker in China.

CTBC was also among the leads on a US$600m three-year debut offshore loan for Chinese leasing company Universal Medical Financial & Technical Advisory Services, pulling in 17 Taiwanese lenders and delivering a 2x oversubscription despite rising concerns over Chinese credit risk and intense competition between rival leasing companies. It was also the only Taiwanese lender to lead a US$300m 2.5-year loan for Philippines-based Rizal Commercial Banking Corp.

CTBC utilised its extensive overseas presence to bring a steady stream of foreign borrowers to the Taiwanese market, including a second deal for India’s Yes Bank in November 2017.

CTBC maintained its leading position in syndicating aviation finance transactions as the coordinator of a US$790m seven-year portfolio financing facility for AerCap, the world’s largest aircraft leasing company. Signed in June 2018, the deal followed a US$950m four-year loan three months earlier where CTBC was one of three coordinating banks. More than 20 lenders in Taiwan, Japan and Singapore participated across the two deals, which closed 1.2x and 1.6x oversubscribed, respectively.

The domestic loan market remained a focus in 2018, with CTBC taking MLAB roles in several jumbo deals, including a NT$90bn (US$3bn) five-year term loan backing Advanced Semiconductor Engineering’s merger with peer Siliconware Precision Industries –Taiwan’s biggest acquisition financing.

To see the digital version of this review, please click here .

To purchase printed copies or a PDF of this review, please email gloria.balbastro@tr.com .

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