Hong Kong-based Li & Fung Limited, the multinational consumer goods sourcing, distribution, and logistics group, targeted Asian private banks with a $500 million bond issue, priced last week.

The transaction, arranged by Citigroup and HSBC, was more than ten times over-subscribed, with over 60 per cent of the allocation being snapped up by private banks, the highest private banking allocation on any Asian bond transaction so far in 2012, according to reports.

The remaining majority of the issue was allocated to asset managers and overall, investors in Asia and Europe made up 87 and 13 per cent of the demand, respectively.

The perpetual bonds will have an initial distribution rate of 6 per cent and received a rating of Baa2 and BBB from Moody's and Standard & Poor's, respectively.

Recent months have seen numerous corporations raising funds by issuing high-yielding perpetual, and other similar structured bond transactions that cater to the yield-hungry appetite of cash-rich Asian private banking investors. For example, French insurance company, CNP Assurances priced a $500 million bond at 7.5 per cent yield last month, with a 90 per cent uptake from private banks.

This trend supports a recent statement made by Coutts saying that the high yield bond market is enjoying a “stellar year”, as reported by WealthBriefingAsia last month.