The week in renminbi: PBoC governor urges corporate debt redefinition, China’s GDP growth to hit 7% in H2, IMF, World Bank to hold annual BRI forums

The governor of the People’s Bank of China says the country should redefine corporate debt, China’s GDP growth could rise to 7% in the second half, and the International Monetary Fund and the World Bank plan annual forums on the Belt and Road Initiative (BRI).

  • By Noah Sin
  • 16 Oct 2017
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  • China needs to reassess the way it defines corporate debt to reflect the level of local government leverage, said Zhou Xiaochuan, the governor of the PBoC.
    Speaking on October 15, Zhou pointed out that corporate debt is the main contributor to China’s high leverage ratio – given that household and government debts are relatively small as a share of GDP. But these statistics fail to show the full picture of China’s debt mountain, he told a panel hosted by the International Monetary Fund and the World Bank.
    “Local governments have generated debt through loans from various financing platforms, all of which are considered corporate debt, which leads to an overestimation of [the total volume of] corporate debt,” he said. “If we audit these debts as government debt, the level of corporate debt would fall on a large scale, government debt would rise accordingly, and [China’s overall] debt structure would be more balanced.”
  • Zhou added that China’s GDP growth could pick up to 7% in the second half of 2017. He attributed the projected acceleration to growing spending by households, which are turning away from consuming goods to services.

Belt and Road:

  • The World Bank and IMF will hold high level forums on the BRI every April and October at their respective annual conferences, said Jim Yong Kim, president of the World Bank.
    Speaking at an October 12 forum co-hosted by the World Bank and China’s Ministry of Finance, Kim said the BRI is a multilateral solution to the world’s problems that reflects the wisdom of China’s leaders, and that the World Bank will actively participate in the implementation of the BRI.


  • The PBoC’s renminbi fix against the dollar was set at 6.5839 this morning, 27bp stronger from Friday. The NEX CNH benchmark came in at 6.5802 at 4.30pm on Friday, firmer than 6.5859 on Thursday.
    The dollar index closed at 93.091 on Friday, up 0.03% from Thursday, according to Bloomberg. The Thomson Reuters CNY reference index closed at 95.98 on Sunday, down 0.02% from its previous close.
    The trade-weighted index by CFETS closed at 95.00 on October 13, up 0.7% from the previous week, with the BIS basket and special drawing rights basket at 95.86 and 95.58, up 0.6% and 0.7%, respectively.

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  • By Noah Sin
  • 16 Oct 2017

GlobalRMB Panda Bonds league table

Rank Arranger Share % by Volume
1 Industrial and Commercial Bank of China (ICBC) 35.00
2 China CITIC Bank Corp 30.00
3 China Merchants Securities Co 17.00
4 HSBC 5.00
4 Standard Chartered Bank 5.00

Panda Bond Database

Pricing Date Issuer Country Size Rmb (m)
1 09-Feb-18 Sino-Ocean Group Holdings Hong Kong 3,000
2 06-Feb-18 Global Logistic Properties via Iowa China Offshore Holdings Hong Kong 1,200
3 05-Feb-18 China Merchants Port Holdings (CMP) Hong Kong 500
4 01-Feb-18 The Emirate of Sharjah United Arab Emirates 2,000
5 25-Jan-18 Sino-Ocean Group Holdings Hong Kong 3,000

Offshore RMB Bond Top Bookrunners

Rank Bookrunner Share % by Volume
1 Standard Chartered Bank 64.14
2 Deutsche Bank (Taipei) 7.95
3 CLSA 7.22
3 Mitsubishi UFJ Financial Group (MUFG) 7.22
5 CTBC Bank (formerly Chinatrust Commercial Bank) 2.85

Latest Offshore RMB Bonds

Pricing Date Issuer Country Size Rmb (m)
1 22-Feb-18 Far East Horizon China 630
2 08-Feb-18 Sinochem Offshore Capital Company China 1,000
3 30-Jan-18 Rabobank The Netherlands 500
4 17-Jan-18 Asian Development Bank (ADB) Philippines 100
5 17-Jan-18 Export-Import Bank of Korea (Kexim) South Korea 270