Fixed Income Daily Market Update

CMBI Credit Commentary Fixed Income Daily Market Update固定收益部市场日报 The new CNH BOCGRI 1.88 04/29/29 edged 0.1pt higher from RO at parthis morning. ZHOSHK 28 was 0.3pt lower. We saw better selling onChinese bank FRNs and front-end issues like LGENSO, but the spreadswere largely unchanged. We saw better buying on higher-grade CNH issues,LGFVs and JP AT1s and insurance subs. SCGAU 5.12509/24/80 edged0.5pt higher post tender offer for any and all of the o/s amt. Glenn Ko, CFA高志和(852) 3657 6235glennko@cmbi.com.hk Cyrena Ng, CPA吳蒨瑩(852) 3900 0801cyrenang@cmbi.com.hk BBLTB:Capital position remains solid despite earning pressure. BBLTBstightened 5-10bps yesterday after Moody’s changed the outlook of Thailandto stable from negative, and were unchanged this morning. See below. CWAHK:Media reported China Water Affairs plans tap of USD150mnCWAHK 5.875 10/22/30 to refinance CWAHK 4.85 05/18/26. CWAHKs wereunchanged this morning. Yujing Zhang张钰婧(852)3900 0830zhangyujing@cmbi.com.hk Trading desk comments交易台市场观点 Yesterday,UBS Perps led the space and rose 0.4-1.1pts.The Swissgovernment outlined plans that would add an extra capital requirement of upto USD20bn to UBS. This will bring its CET1 ratio increase to c15.5%,compared to 14.4% as of Dec’25. We think the market over-reacted on thisnews, taking cues of USB’s strong push-back.Therest of Yankee AT1ssoftenedinto London session amid better-selling from AMs and prop desksin the belly and long-end of the curve.In SE Asian space, GLPSPs/GLPCHI29 dropped 3.1-4.3pts with no specific headline news.Thai IG credits suchas BBLTB/PTTGC/TOPTB tightened 5-10bps after Moody’s surprised moveto change the outlook on Thailand to stable from negative and affirmed Baa1rating.See comments below on Bangkok Bank 1Q26 results.Taiwaneselifers were 1-2bps tighter, though we saw modest selling in FUBON andNSINTW.In Chinese IG space, we saw better buying on BABA 35 and front-end MEITUA papers, and the space closed unchanged to 1bp tighter. BTSDF28 lost 0.1pt. Moody’s changed the outlook of H&H to stable from negativeand affirmed Ba3 ratings, reflecting the sustained recovery in H&H's infantmilkformula sales and strengthening consolidated profit margins.InHK/Chinese properties, VNKRLE 29’ edged 0.8pt higher, while VNKRLE 27’closed unchanged. See our commentsyesterdayon Vanke’s 3rd extensionof onshore bond maturity. FUTLAN 28/FTLNHD 26-29 were unchanged to0.3pt firmer. The NWDEVL/VDNWDL complex were upto 0.9pt lower.In KRspace,PKX/POHANG/5-10yr LGENSO papers and front-end HYUELEissues traded 2-4bps tighter amid better buying. In JP space, we saw betterbuying in 5yr FRNs but selling pressure in 10yr SEKIS/SUMITR/KYUSELpapers. NOMURA 36s traded inmixed two-way flows. In LGFV space, RMscontinued to buy higher-yielding bonds, primarily CNH issues. Last Trading Day’s Top Movers Marco News Recap宏观新闻回顾 Macro–S&P (+1.05%), Dow (+0.69%) and Nasdaq (+1.64%) were higher on Wednesday. US crude oilinventories was +1.925mn, compared to the market expectation of-1.9mn. 2/30 yrUST yield was higher onWednesday. 2/5/10/30 year yield was at 3.79%/3.91%/4.30%/4.90%. Desk Analyst Comments分析员市场观点 BBLTB: Capital position remains solid despite earning pressure We maintain buy on BangkokBank (BBLTB)’s two T2s BBLTB 3.466 09/23/36 (first call in Sep’31) and BBLTB6.056 03/25/40 (first call in Mar’35). BBLTB has track records of first-call redemptions, and we expect BBLTBto continue to call its subordinated bonds on the first call dates, taking cues from its sufficient capital buffer andtrack records for early redemptions. Yesterday, Moody’s revised the outlook of BBLTB to stable from negative and affirmed its Baa1 rating, followingthe agency’s sovereign action on Thailand earlier thisweek. The outlook revision reflects Moody’s view that thetariff shock from the US have diminished, as US tariffs on Thai exports were reduced to levels broadly in linewith regional peers. The rating actions, in our opinion, are a bit of positive surprise in term of timing given thepotential impact of the Israel-US war against Iran to Thai economy, and should support the near-termperformance of BBLTB T2s, which are rated at the borderline IG. The stable outlook of the sovereign and bankhas reduced near-term downgrade risk. In 1Q26, BBLTB’s net interest income fell 12.3% yoy to THB28.0bn while NIM compressed to 2.49% from2.89%, reflecting the lower-rate environment following four BOT policy rate cuts since Feb’25 (25bps in Feb’25,Aug’25, Dec’25, andFeb’26), bringing the policy rate to 1.0%, the lowest level since Sep’22. Non-interestincome declined 6.6% yoy to THB12.8bn, dragged by lower net gains on investments and loan related fees.Total operating income decreased by 10.6% yoy to THB40.8bn, withhigher dividend income and securitiesrelated fees from improved Thai capital market during 1Q26, and these partially offset the NII and fee incomeweakness.Cost-to-income ratio improved to 44.7%in 1Q26 from 45.5%in 1Q25 on operating cost