(Or “Another reason why perps are so popular among coporates”)
As the sovereign debt crisis drags on, international lending by global banks in the fourth quarter last year fell by the largest amount since the Lehman Brothers crisis in 2008.
Gd news for our three local banks. They can expand their US$ lending activities (US$ is preferred currency of borrowers).
Expect them to raise more perps. They will be exploring the possibility of selling US$ perps to our local retailer investors to avoid having to swap the proceeds into US$. But retail investors don’t like foreign currency issues: juz look at Hutch Ports.