Last week (August 16), ANZ announced several key hires within the bank’s Capital Markets capability across Asia and the Americas.
In Hong Kong, the bank announced the appointment of Paul Chang to lead its North Asia Debt Capital Markets business alongside Louise Yang, as co-heads of the DCM origination effort across products and client segments in the region. The pair will also manage the team based in Hong Kong. They report into KJ Kim, head of Capital Markets, Asia.
Chang joins the institution from SocGen, where he worked in the Asia-based Sustainable Finance team. He brings to ANZ over 12 years of dealing with Fixed Income and Corporate issuers in the investment grade space. The note shared with media pointed to his valued experience as the bank looks to grow its major issuer centres in Hong Kong, Korea and Japan.
Speaking to FinanceAsia, Chang elaborated on his focus alongside Yang. “Our number one priority is to further develop ANZ’s presence and franchise value in the region through focusing on three key areas: expanding our product range for clients with an international capital markets presence, increasing cross-border capital markets flows, and helping our customers transition to net zero carbon.”
He said his remit will centre on developing Korea, Hong Kong and Japan, while Yang will focus on expanding the bank’s presence in China and HK.
Chang offered FA some perspective around how capital markets activity will play out across the remainder of 2022.
“Although this year has been one of the most challenging in recent times for capital markets, it wasn’t entirely unexpected. With issuers side-lined due to the increasing cost of bond markets outpacing loan markets, and local currency markets providing attractive pricing, we have seen a bulk of refinancing requirements move away from international markets.”
However, he views current conditions as marking a point of inflection.
“Markets are starting to bounce back following rate rises, and we are seeing a pickup in loan market costs. With another wall of refinancing due next year, we expect clients will start to come back to the bond markets.”
“We also anticipate issuance volumes to pick up in 4Q, which could carry over to early 2023 providing strong momentum for issuance.”
Inflation makes an impact
He said that for Asia-based market participants, inflation has been top of mind due to a faster-than-expected rebound in economic activities across the region. “This stronger than expected burst of inflation put immense pressure on issuers and increased the burden of borrowing as investors anticipating higher inflation demanded higher yields.”
Such volatility, he said, resulted in investors staying within their comfort zones, by reducing their risk and exposure when it came to assets that they were not wholly comfortable with, which impacted Asian credit overall.
“Even though markets remained open for selected investment grade issuers with a well-established track record, it was extremely difficult for new names to gain access.”
However, this did have some upside. “Despite this resulting in increased funding costs for Asian issuers, it made their credits attractive compared to their peer groups in other parts of the world.”
Chang added that he expects demand for Asian credit to recover once there are signs of market stabilisation. “We could slowly anticipate a disinflationary trend to set in towards the 4Q and demand increasing on Asian credit.”
Sharing his excitement to join the team, he told FA, “ANZ has a strong markets distribution across APAC and our north Asian client base is perfectly suited to diversify access into these markets. We also have a strong sustainable finance business, at a time when ESG considerations will underpin all business activities.”
The ESG effort
Touching on how volatile energy prices are impacting ESG endeavours and Asia’s energy transition, he said that while it is discouraging to witness some economies ramping up coal consumption, “it’s unlikely investors would drastically increase investment in renewable energy in response to recent price hikes as investments into energy infrastructure are long-term by nature.”
“We have started to see a push from governments to adjust traditional energy infrastructure and institutional systems to accommodate and promote innovative solutions to accelerate clean energy transition in Asia.” He added that while this is promising, it calls for the support of the tailored solutions and integrated expertise that the ANZ team can draw upon given the distinct developmental challenges across the region.
The note to media also highlighted several other appointments.
In Singapore, Shoaib Ahmed has joined the bank from ING, as director of South & Southeast Asia Capital Markets. The senior role sees him take on responsibility for the origination of all primary products across the region, drawing upon his experience at the Dutch bank, as well as his time handling debt origination and syndication at RBS.
Jack Ang continues as head of Capital Markets across South, Southeast Asia and the Middle East, in addition to his post as head of Debt Syndicate for the region. He reports to KJ Kim.
In New York, Robyn Bedil has joined the bank from Bank of America, as director of Debt Capital Markets. Terrence Zheng reports to her following his move from Singapore to join the Capital Markets team. Both will work closely with Michael Thilmany who leads the Private Placements team in the region, following his recruitment to the bank in 2021 to broaden its capability to offer full origination, execution and distribution opportunities to customers.