June 08, 2015 (LBO) – Asian debt capital markets have quadrupled over the past seven years and growth momentum will continue in the years to come, a HSBC official said.
“It would be incorrect to say that debt market can’t grow at a frantic pace,” Kartik N, Director Debt Capital Markets of Asia Pacific at HSBC said.
As per the data, way back in 2008, Asia had 15 transactions happening in the debt capital market and in 2010, there were 150 trades with a volume of 75 billion US dollars.
In 2012 that moved to 249 trades with a volume of 128 billion US dollars.
For the first half of 2015, there were 167 trades with volumes reaching at 95 billion US dollars.
“The journey from 2008 to 2015 has seen the Asian bond market more than quadruple in size and in terms of both depth of market, number of transactions happening and also the volume of transactions that are going through.” Kartik said.
He was speaking at the 63rd LBR LBO CEO Forum which was held recently in Sri Lanka’s capital Colombo under the theme ‘reimagining debt capital market to unlock opportunities and sustain growth’.
Top 100 ASEAN companies had literally doubled the debt on their books from 125 billion in 2008 to 270 billion in 2014, Kartik stated.
“Is that reckless borrowing? The answer is no. If you look at the financial statements in these companies and analyze them you’ll notice that these are actually funding growth,”
“When you talk about funding growth about a company you are actually funding growth of an economy in the larger scale of things,” Kartik stressed.
He said the Sri Lankan debt market is currently like the Asian debt market that was there in 2008.
“I don’t think that Sri Lanka is way too behind. The way I would look at is you were probably where the Asian markets were back in 2008. It was a 15 deal market.”