* China and Hong Kong set new loan volume records
* North Asia lending of $244 bln 66 percent higher than 2012
* M&A lending up 63 percent to $46 bln
By Jacqueline Poh
HONG KONG, Dec 31 (Reuters Basis Point) - Syndicated lending
in Asia Pacific (excluding Japan) hit a record high of $462
billion in 2013, showing an increase of 51 percent on $307
billion in 2012, as demand from Chinese companies doubled,
according to Thomson Reuters LPC data.
Chinese loan volume soared $117 billion, up 99 percent on a
year earlier, as China's companies and provincial governments
borrowed heavily to finance acquisitions and infrastructure.
Hong Kong also set a new record of $80 billion in 2013, with
an 86 percent increase on 2012. Nearly 70 percent of Hong Kong
loans were for mainland Chinese companies, which moved offshore
to raise cheaper foreign currency ofloans after government
regulations curbed onshore US dollar lending in May.
Strong growth in China and Hong Kong boosted North Asia
lending to $244 billion, up 66 percent on $147 billion in 2012.
Southeast Asia's loan markets shrugged off macroeconomic
weakness and currency depreciation in India and Indonesia and
volume rose 51 percent to $80 billion from $52.6 billion in
2012. Malaysia, Philippines and Thailand also set new loan
Asia saw more jumbo multibillion dollar loans in 2013 and
average loan sizes of roughly $400 million were 20 percent
bigger than in 2012.
The biggest loan of the year was a 1.98 trillion yen loan
for Japanese wireless carrier SoftBank Corp in
September, which refinanced a one-year bridge loan from December
2012 that backed SoftBank's $21.6 billion acquisition of
US-based telecom Sprint Corp.
Japan was Asia's biggest loan market in 2013 with volume of
$276 billion, but lending dipped 15 percent from $324.5 billion
in the previous 12 months due to reduced levels of merger and
acquisition (M&A) activity.
Other jumbo Asian loans included an $8 billion refinancing
for Chinese e-commerce company Alibaba Group and a $6
billion bridge loan backing Thai convenience store operator CP
All Pcl's takeover of Siam Makro Pcl.
"It is not every year that we see $8 billion or $6 billion
deal sizes, but $2 billion or $3 billion is normal all of a
sudden," said Aditya Agarwal, head of loan syndicate for Asia
Pacific at Royal Bank of Scotland.
Excluding Japan, M&A activity in Asia Pacific rose 63 percent to
$46 billion in 2013 from a year earlier. Hong Kong was
especially busy with 37 percent of acquisition loans backing
Chinese firms' overseas expansion.
China National Offshore Oil Corp raised $9 billion in two
separate loans backing Australian and Canadian acquisitions, and
pork producer Shuanghui International Holdings Ltd
took a $4 billion acquisition loan to buy Smithfield Foods of
Leveraged loans backing private equity buyouts climbed 20
percent to around $8.5 billion from $7 billion in 2012. Deals
included a $1.075 billion loan backing the $3.7 billion buyout
of US-listed Chinese display advertising company Focus Media
Holding Ltd, which is the largest leveraged buyout of a Chinese
company to date and more are expected.
"The success of recent LBO financings will encourage private
equity sponsors to tap the loan market," said Ashish Sharma,
head of Asia Pacific loan syndication at Credit Suisse.
M&A activity pushed Singapore volume 21 percent higher to
$40 billion in 2013 from $33 billion a year earlier due to a
S$9.3 billion ($7.4 billion) loan backing Thai Charoen Corp
Group's takeover of beverage maker Fraser & Neave Ltd and annual
refinancings for commodities companies.
Despite Indonesia's macroeconomic problems, Indonesian
companies raised $12.7 billion of offshore syndicated loans,
the second highest volume recorded, and 140 percent higher than
$5.3 billion in 2012.
"We have seen deals on all fronts in Indonesia, from
different sectors and priced from 150bp to 650bp," said Bryan
Liew, Standard Chartered Bank's regional head of syndications
for Southeast Asia.
Australian lending picked up in the last six months and
volume of $100 billion was 25 percent higher than $80 billion in
2012. Australian companies also raised around $10 billion of
loans in the US institutional loan market which offered more
flexible longer-term loans than Australian banks.
(Reporting by Jacqueline Poh, editing by Tessa Walsh)