Syndicated lending in Asia Pacific (ex-Japan) in the first half of 2020 plunged almost 17 per cent to an eight-year low of US$196 billion, while deal counts dropped 19 per cent year-on-year, according to analysis from Refinitiv.
Bank of China topped the 1H20 Asia Pacific (ex-Japan) mandated arranger league tables, with a market share of 18.1 per cent (deal volume of US$35bn, from 261 deals) followed by ANZ (US$9.6 bn, 79 deals) and DBS Bank (US$6.9 bn, 60 deals).
The only regional markets to buck the trend were Australia and Taiwan, as the impact of the second quarter slowdown due to the coronavirus pandemic hit hard.
Refinancings remained the mainstay of regional loan volume, accounting for more than 38 per cent of total lending for the first half of 2020, although at US$75bn the segment was down 16 per cent year-on-year.
The largest refinancing was a US$8.4bn loan for Ichthys LNG Pty Ltd to back its liquefied natural gas project in Western Australia. The deal was also the biggest transaction completed in Asia Pacific (ex-Japan) during 1H20.
The largest M&A loan completed during the second quarter was the A$5.25bn (US$3.7bn) financing, put in place to support the proposed merger of Vodafone Hutchison Australia and TPG Telecom Ltd.
These two jumbo deals pushed Australia into an unaccustomed role as the standout syndicated loan market in Asia Pacific (ex-Japan) – the second-largest behind China – with 88 deals worth US$45bn. This was an increase in lending volumes just shy of 20 per cent over the same half last year.
The only other major market to post year-on-year growth was Taiwan, which registered a 6 per cent rise in 1H20 loan volume to US$20bn. Jumbo loans included the NT$87.3bn (US$2.9bn) project financing for Changfang Wind Power Co Ltd and the NT$48.5bn takeout loan for electronic components maker Yageo Corp to replace a bridge financing signed in March for its acquisition of US rival Kemet Corp.
Lending activity across the rest of the region slowed down considerably in 1H20, with South-East Asia's syndicated loan volumes tumbling by more than 45 per cent to a 10-year low of US$23bn.
Singapore, the biggest market in the sub-region, posted a 34 per cent drop to US$14.5bn in the first six months of 2020. Indonesia and Malaysia also declined year-on-year by around 30 per cent and 40 per cent, to US$4.9bn and US$2.1bn, respectively.
Locally, ANZ was pipped by CBA on deal volume, as measured in the Refinitiv mandated arranger league tables for Australia (US$6.4bn versus US$5.9bn), although ANZ was involved in 45 deals, one more than CBA. NAB's loan team was placed third in their home market, arranging 32 deals, worth US$3.2 billion in the first six months of 2020.