Driving on the area’s progress momentum, Asean affords more and more interesting alternatives for capital elevating and advisory companies that UOB is concentrated on tapping into.
“We see large alternatives in Asean,” mentioned Leong, pointing to the huge scope for cross-border commerce, which UOB estimates is price greater than $2 trillion. “This may also drive a number of the exercise in FDI flows that may create CapEx and M&A alternatives.”
The financial institution is nicely positioned to capitalise on these. Its world community counts over 500 places of work in Southeast Asia, Higher China and around the globe, catering to giant, medium and small enterprises from multinationals and sovereign wealth funds, to monetary sponsors and the SME sector.
“We give attention to the thematics and the options that drive financial exercise and cross-border commerce within the area,” added Leong.
A promising issuance outlook
Inside Asean, UOB sees two key drivers for issuance quantity: refinancing and progress capital.
The potential for refinancing can’t be underestimated. In keeping with Leong, greater than $300 billion in bonds will probably be due for refinancing in Asia ex-Japan over the subsequent 12 months. And final yr’s issuance quantity might solely fulfill half of that.
Because of this, he defined, with rates of interest within the US staying greater for longer, UOB envisages Asean native forex markets to have the ability to fulfill these wants.
In the meantime, progress capital will proceed to be an essential supply of issuance. “We see frequent issuers faucet the native bond markets. Additionally, with home funds and excessive internet price liquidity chasing greater returns and yield, fairness capital markets will rebound when it comes to IPOs,” mentioned Leong.
Thematics to drive Asean’s potential
A number of supportive thematics additionally underscore the area’s potential for capital elevating and advisory companies.
Firstly, the availability chain shift – each when it comes to China+1 in addition to Western companies getting into Asean – will gas a number of CapEx wants and financing throughout sectors corresponding to high-end electronics in Vietnam and Malaysia.
Auto manufacturing is one other progress story, particularly in Thailand and Malaysia, together with the electrical car provide chain, together with battery sources in Indonesia.
Knowledge centres characterize one other sector the place Leong sees vital alternative. This in flip drives manufacturing of synthetic intelligence-related tools, plus the necessity for energy, and specifically, renewables infrastructure.
On the identical time, home consumption continues to be robust inside Asean, together with excessive round progress sectors like healthcare, schooling and logistics.
A differentiated set of options
To anchor UOB’s Asean imaginative and prescient is what Leong describes as a well-balanced and counter-cyclical funding banking platform that may face up to headwinds from volatility, plus profit from the tailwinds of robust public markets. “Our strengths have at all times been specializing in consumer wants and being much less transactional.”
This method is rooted in three core methods: connectivity, customised options and sustainability.
For instance, connectivity stems from UOB’s providing because the One Financial institution for ASEAN. “We have now at all times been in a position to provide a broad vary of funding banking companies to our consumer base who’re lively on this area,” Leong mentioned.
The financial institution is ready to ship these by bringing collectively groups that may present customised multi-product capital markets and advisory options. “This has been vital for us to win and safe repeat mandates from purchasers,” he defined.
To enrich these dynamics, UOB has constantly organized $40 billion to $50 billion in sustainability financing throughout the area yearly. Additional, added Leong, UOB was the primary bookrunner and mandated lead arranger in 2024 for inexperienced loans in Asia ex-Japan.
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