Asia Pacific

Two Taiwan local securities firms, Yuanta Securities and KGI Securities, are planning to issue their debut Formosa bonds in the next few weeks, two DCM bankers have told GlobalRMB. They would be the first renminbi-denominated bonds from securities houses in Taiwan.

Guangdong based Times Property Holdings completed its fourth appearance in the debt market this year by tapping its existing offshore renminbi bond for an extra Rmb600m ($98m) on October 7. But the trade proved to be tougher than expected as a result of a sell-off in Chinese property bonds.

Net dim sum primary issuance had its third strongest month this year in September, but China macro data woes and RMB liquidity constraints risk spoiling the Stock Connect launch party later this month.

The Central American Bank for Economic Integration (Cabei) priced its second offshore RMB (CNH) bond on Monday, October 6, opting this time for a Rmb500m ($81m) debut in Taiwan's Formosa market.

Several enquiries from yield hungry investors have prompted Times Property Holdings to tap its existing Rmb900m ($146m) dim sum bond on October 7.

Hong Kong investors are not expecting the launch of the Shanghai-Hong Kong Stock Connect to provide them with sparkling gains compared to local stocks, as concerns regarding Chinese property markets and local government debt weigh on the prospect of increased exposure.

Brazil obtained a Rmb190bn ($77.3bn) swap line last year, but since then there has only been one public dim sum bond from an issuer in the country. The solution to boost the local RMB market is to take advantage of the infrastructure that Hong Kong offers, says that city’s government.

The People’s Bank of China (PBoC) announced the launch of direct trading of RMB and Euro in the Shanghai interbank market on September 29. Market players are expecting tighter FX spreads, a longer swap curve and broader RMB adoption among European traders. A PBoC official was also on the record stating that the China International Payment System will formally be set up in Shanghai.

The London Stock Exchange (LSE) is looking to play the role of provider of key European infrastructure for investors looking to increase their China exposure, and for Chinese investors looking to raise funds in Europe in RMB or other currencies.

The advance of the RMB as an international trade and investment currency, accompanied by a robust programme of policy initiatives, is boosting Chinese banks' bottom line. The latest evidence of the trend comes from Agricultural Bank of China (ABC) and Industrial and Commercial Bank of China (ICBC), which have released data on their financial performance in the first half of 2014.

In this round-up, RMB deposits in Hong Kong stay flat, RMB cross border trade settlement falls 2.3%, Luxembourg RMB deposits rose 5% to Rmb67.2bn ($11bn) in the first half of the year, and Eurogiro launches direct RMB payments to China.

The lack of a securities lending market for green bonds could be stifling the ability of banks to make markets in the product, leaving the buyside struggling to pick up paper in secondaries, a leading investor told GlobalCapital this week. But on the primary side, green demand grows ever healthier, with another set of firsts from public sector borrowers on the way.