Fixed Income Daily Market Update

CMBI Credit Commentary Fixed Income Daily Market Update固定收益部市场日报 This morning, the new DAESEC 29-31 were unchanged to 1bp wider fromROs. The new SUMI 31 tightened 6bps from RO at T+90, and SUMI 36tightened 1bp. SUMIBK 41 and ADVANC 31-36 were unchanged in spreadsfrom ROs. Rest of secondary Asian IG space recovered andtightened 1-3bps. Glenn Ko, CFA高志和(852) 3657 6235glennko@cmbi.com.hk MEDCIJ:Call MEDCIJ 6 ⅜ 01/30/27 on 27 Mar’26 at par. Maintain buy onMEDCIJ 8.625 05/19/30. See below. Cyrena Ng, CPA吳蒨瑩(852) 3900 0801cyrenang@cmbi.com.hk RAKUTN:Rakuten will call RAKUTN 5.125 Perp of USD750mn on the firstcall datein Apr’26. Maintain buy on RAKUTN 8.125 Perp. Please also readour comments on Rakuten’s FY25 results in our daily on23 Feb’26. Yujing Zhang张钰婧(852)3900 0830zhangyujing@cmbi.com.hk Trading desk comments交易台市场观点  Yesterday,Chinese IG space overall widened 3-5bps, driven by better sellingon 30yr BABA/TENCNT/XIAOMI and HAOHUA 27-30, while other belly-to-front-end papers held up relatively well. TW lifers also widened 3-5bps. Wesaw block selling on FUBON, small but steady offers on CATLIF, balancedtwo-way interests in NSINTW, and quiet trading in SHIKON. In HK space,LINREI 36 widened 3bps. CKHHs remained largely quiet. The Panamaniangovernment took control of 2 ports on the Panama Canal from CK Hutchison(CKH).Over the past 28 years,CKH invested cUSD1.7bn in the 2Panamanian ports compared with CKH’s total assets was USD147bn as ofJun’25. We estimated the dividend income from its 90% stakes in the 2Panamanian ports to be cUSD1.1bn,i.e. USD40.5mn p.a. on averagecomparedwith CKH's 1H25 operating cash flow was USD4bn. Additionally,the 2 Panamanian ports handled c4% of CKH’s global throughput in 1H25.Hence, we believe that the impact of concession cancellation and take-overof port assets should be relatively small.NWDEVL Perps rose 0.6-1.4pts,while VDNWDL Perp closed unchanged. In Chinese properties, FUTLAN 28was 0.9pt higher, while FTLNHD 26-27 were unchanged to 1.0pt lower.VNKRLE 27-29 leaked 0.4-0.6pt. In KR space, POHANG/LGENSO/HYUELEwith tenor longer than 7yrs and HYNMTR 33-36s widened 3-5bps on back ofChinese onshore block selling. DAESEC 28-29 closed 1-2bps wider. MiraeAsset Securities priced the new 3yr/5yr USD bonds. In SE Asian space, IGbonds traded 2-4bps wider, with notable selling on 5yr Malaysian bank notesand 10yr EXIMBK tranches. MEDCIJ 28-30s were 0.1pt lower, while MEDCIJ27s edged 0.2pt higher. Medco Energi will call MEDCIJ 6.375 01/30/27 on27 Mar’26 at par. See comments below. In JP space, IG credits widened 2-4bps across the board, led by better selling on MIZUHO, MUFG and fixed10yr SUMIBK papers. JP insurance subs managed to grind a touch firmer. Incontrast, Yankee AT1s retraced by 0.1pt, driven mainly by selling flowsduring London session. In AU, there was increased selling pressure onlong-dated callable T2s. In LGFV space,RMs remained better buyers while tactical investors and some AMs were better sellers ofShandong papers down the credit curve, as well as several other short-dated issues. Last Trading Day’s Top Movers Marco News Recap宏观新闻回顾 Macro–S&P (+0.77%), Dow (+0.76%) and Nasdaq (+1.04%) werehigheron Tuesday. US Feb’26 CB ConsumerConfidence was91.2, higher than the market expectation of 87.4. 5/10 year UST yield was higher on Tuesday.2/5/10/30 year yield was at 3.43%/3.61%/4.04%/4.70%. Desk Analyst Comments分析员市场观点 MEDCIJ:CallMEDCIJ 6 ⅜ 01/30/27 on 27 Mar’26 at par Medco Energi (Medco) will call the remaining outstanding amount (USD107.77mn) of MEDCIJ 6 ⅜ 01/30/27 infull on 27 Mar’26 at par. The call is in line with our expectation that Medco is a candidate for early redemptionof its outstanding USD bonds and technical of Indonesian HY will remain strong given the potential earlyredemptions. Over the past few years, Medco has been actively extending its debt maturity profile, thanks toits sufficient liquidity and good access to various funding channels.It has early redeemed a total ofUSD542.23mn in principal amount of MEDCIJ 6 ⅜ 01/30/27 since Apr’22. Hence, remaining outstanding of thebond had notably reduced to USD107.77mn from the initial issue amount of USD650mn. During 9M25, Medco conducted proactive liability management despite modestly weaker9M25 resultsin alower oil price environment. It issued offshore bonds of USD400mn and retired USD bonds totaling USD519mnin principal amount via tender offers and buybacks. Medco also tapped on the onshore bond market with issuestotaling IDR2.5tn and IDR1tn bonds in Jan’25 and Jun’25, respectively.We expect Medco to continueearlyredemptions of its USD bonds. We like Medco’s stable credit story and maintain buy on MEDCIJ 8.625 05/19/30for better risk-adjusted return profile with better trading liquidity within the MEDCIJ curve. At 105.6, MEDCIJ8.625 05/19/30 is trading at YTM of 7.1%. News and market color Regardingonshoreprimary issuances, there were 16 credit bonds issued yesterday with an amount ofRMB15bn. As f