Greater China
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Despite taking major steps to promote itself as a renminbi hub, Taiwan’s onshore withholding tax is likely to hamper the island’s ambition to grow its dim sum bond market – to the benefit of Hong Kong. -
Chinese textile and garments supplier Pointer Investment (Hong Kong) raised Rmb400m ($63.6m) from its first foray into the dim sum market last week.
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Hong Kong lender Citic Bank International raised Rmb500m ($79.3m) from its first public deal in the dim sum bond market on Tuesday.
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Top 3 Offshore RMB DCM Transactions - 2012 YTD
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Shinhan Bank raised A$250m ($260.7m) from its return to the Kangaroo bond market, managing to increase the deal after getting strong demand from Australian investors.
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Korean lender Shinhan Bank started bookbuilding for a A$100m ($104m) Kangaroo bond on Monday, returning to Australia’s domestic debt market after making its debut more than five years ago.
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Guarantees that appear to give dim sum bondholders recourse to the assets and cash flows of onshore Chinese corporations in case of default are unlikely to hold up if tested.
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Offshore renminbi bond issuance will enjoy increased deal flow on the back of greater investment, to the extent that it enjoys greater volumes than deals done in the city’s own currency, say dealers.
