Reg S bond market: The rise of Asia’s own dollar bond market
The growth of the Reg S bond market has been one of the defining trends of the Asian capital markets in recent years. Driven by the seemingly unstoppable rise of Asian wealth – especially deep-pocketed Chinese investors – US dollar bond sales in the region no longer depend on the participation of US institutions.
Dollar debt issuance swelled to a record US$376bn in 2017 in Asia Pacific, excluding Japan, up 45% on the previous year.
IFR gathered a panel of market specialists to discuss the Reg S phenomenon in Hong Kong late last year. The panelists included the Export-Import Bank of Korea, CLP Power Holdings, JP Morgan, Fidelity International, Clifford Chance and National Australia Bank.
The panel debated how far the Reg S market would go, how sustainable it would be to rising US interest rates, reliability on China and whether a more concentrated, regional investor base poses liquidity risks for Asian borrowers in the future.
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