Financial Regulatory Forum

ADB says fresh China “panda” bonds need govt okay

December 7, 2009
    BEIJING, Dec 7 (Reuters) – Future issuances of Chinese yuan “panda” bonds from the Asian Development Bank (ADB) will first need fresh approval from the Chinese government, the bank said on Monday, after its second issue of the yuan-denominated bonds.
   “Panda” bonds [0#PANDA=CDC], which debuted in 2005, are yuan bonds issued in China by non-Chinese entities.
   So far, two issuers — the International Financial Corp and the ADB — have sold a combined total of 4 billion yuan ($587 million), including ADB’s latest 1 billion yuan 10-year panda bonds priced last Friday. [ID:nSHA276397]
   China earlier this year mapped out plans to make Shanghai a global financial centre by 2020, including allowing more international institutions to issue bonds [ID:nSHA205030]
   Hua Jingdong, deputy treasurer with the ADB, told reporters the bank’s panda bonds had proven popular, but fresh issuances first needed approval from Chinese authorities.
   “The name panda is very appropriate, because it’s very valuable and it’s rare. Of course, we’d like to issue much more frequently”, Hua told a news briefing in Beijing, speaking of the bonds.
   Hua said China’s cabinet in 2005 had given the ADB permission to issue 2 billion yuan, or “renminbi”, in the panda bonds, and the bank’s recent second issuance had exhausted that limit.
   “As ADB ventures more into non-sovereign, private-sector lending in the future, then private-sector borrowers prefer to borrow in renminbi to avoid currency risks,” Hua said.
   “I’m very optimistic that we will come back in the near future, but first we need to get another licence from the Chinese government”. (Reporting by Chris Buckley; Editing by Jacqueline Wong)
 ((chris.buckley@thomsonreuters.com; +86-13501014479)) ((If you have a query or comment on this story, send an email to newsfeedback.asia@thomsonreuters.com)) Keywords: CHINA BONDS/ADB
  
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 Monday, 07 December 2009 10:58:00RTRS [nTOE5B606V] {EN}ENDS

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